constrained-efficient allocation. The key as in general equilibrium theory is to extend the commodity space in such a way that …

Typical models of bankruptcy and collateral rely on incomplete asset markets. In fact, bankruptcy and collateral add … and Levine (2001) can be implemented in a model with bankruptcy and collateral. The equilibrium allocation is constrained … a model with bankruptcy and collateral is fragile in the sense of Leijonhufvud's "corridor of stability," however: If …

unsecured lending and substantial increases in haircuts on posted collateral. This paper seeks to understand the implications of …

When firms are able to pledge their assets as collateral, investment and borrowing become endogenous: pledgeable assets … between capital spending and cash flows is non-monotonic in the firm's asset tangibility. Our theory allows us to use a …

classical option theory. A substantial literature has emerged examining the problem, focusing on the characteristics of the … behavior, using both householder characteristics and collateral (house) value. Second, it empirically recognizes important … interactions between the status of the prepayment option and the influence of income and collateral constraints upon prepayment …

nominal interest rate), in a general-equilibrium model of asset pricing and risk sharing with endogenous collateral … constraints of the kind proposed by Geanakoplos (1997). The existence of collateral constraints allows our model to capture the …-bank purchases raise the price of the asset, owing to binding collateral constraints, the effects need not be the ones commonly …

types of pecuniary externalities: distributive externalities that arise from incomplete insurance markets and collateral … pecuniary externalities. We demonstrate how to employ our framework in a number of applications. Whereas collateral …