Narrow search
Showing 1 - 10 of 149
Cover Image
Bubbles and Self-Enforcing Debt
Hellwig, Christian; Lorenzoni, Guido - National Bureau of Economic Research (NBER) - 2006
We characterize equilibria with endogenous debt constraints for a general equilibrium economy with limited commitment … equilibrium debt limits must satisfy a simple condition that allows agents to exactly roll over existing debt period by period …. Second, we provide an equivalence result, whereby the resulting set of equilibrium allocations with self-enforcing private …
Persistent link: https://www.econbiz.de/10005775063
Cover Image
Uncertainty as Commitment
Ordonez, Guillermo L.; Nosal, Jaromir - National Bureau of Economic Research (NBER) - 2013
Time-inconsistency of no-bailout policies can create incentives for banks to take excessive risks and generate endogenous crises when the government cannot commit. However, at the outbreak of financial problems, usually the government is uncertain about their nature, and hence it may delay...
Persistent link: https://www.econbiz.de/10010969240
Cover Image
The Asymmetric Effects of Financial Frictions
Ordonez, Guillermo L. - National Bureau of Economic Research (NBER) - 2012
Economic variables are known to move asymmetrically over the business cycle: quickly and sharply during crises, but slowly and gradually during recoveries. Not known is the fact that this asymmetry is stronger in countries with less-developed financial systems. This new fact is documented using...
Persistent link: https://www.econbiz.de/10010969333
Cover Image
Market Liquidity -- Theory and Empirical Evidence
Vayanos, Dimitri; Wang, Jiang - National Bureau of Economic Research (NBER) - 2012
In this paper we survey the theoretical and empirical literature on market liquidity. We organize both literatures around three basic questions: (a) how to measure illiquidity, (b) how illiquidity relates to underlying market imperfections and other asset characteristics, and (c) how illiquidity...
Persistent link: https://www.econbiz.de/10010951230
Cover Image
Strategic Trading in Informationally Complex Environments
Ostrovsky, Michael; Lambert, Nicolas S.; Panov, Mikhail - National Bureau of Economic Research (NBER) - 2014
competitive market makers, and the demand from liquidity traders. We show that there always exists a unique linear equilibrium …
Persistent link: https://www.econbiz.de/10010951327
Cover Image
Competing for Order Flow in OTC Markets
Weill, Pierre-Olivier; Lester, Benjamin; Rocheteau, … - National Bureau of Economic Research (NBER) - 2014
equilibrium in a general setting, and illustrate how the model can account for several important trading patterns in over … frictions affect the per-unit trading costs that investors pay in equilibrium. …
Persistent link: https://www.econbiz.de/10010951340
Cover Image
Why Did So Many People Make So Many Ex Post Bad Decisions? The Causes of the Foreclosure Crisis
Foote, Christopher Lee; Gerardi, Kristopher S.; Willen, … - National Bureau of Economic Research (NBER) - 2012
We present 12 facts about the mortgage crisis. We argue that the facts refute the popular story that the crisis resulted from finance industry insiders deceiving uninformed mortgage borrowers and investors. Instead, we argue that borrowers and investors made decisions that were rational and...
Persistent link: https://www.econbiz.de/10011271486
Cover Image
Friends or Foes: The Interrelationship between Angel and Venture Capital Markets
Hellmann, Thomas; Thiele, Veikko - National Bureau of Economic Research (NBER) - 2014
we derive the equilibrium deal flows across the two markets, endogenously deriving market sizes, competitive structures …
Persistent link: https://www.econbiz.de/10011262798
Cover Image
The 2007 Subprime Market Crisis Through the Lens of European Central Bank Auctions for Short-Term Funds
Cassola, Nuno; Hortacsu, Ali; Kastl, Jakub - National Bureau of Economic Research (NBER) - 2009
In this paper we study European banks' demand for short-term funds (liquidity) during the summer 2007 subprime market crisis. We use bidding data from the European Central Bank's auctions for one-week loans, their main channel of monetary policy implementation. Through a model of bidding, we...
Persistent link: https://www.econbiz.de/10005079174
Cover Image
Evaluating Asset Pricing Models with Limited Commitment using Household Consumption Data
Krueger, Dirk; Lustig, Hanno; Perri, Fabrizio - National Bureau of Economic Research (NBER) - 2007
We evaluate the asset pricing implications of a class of models in which risk sharing is imperfect because of limited enforcement of intertemporal contracts. Lustig (2004) has shown that in such a model the asset pricing kernel can be written as a simple function of the aggregate consumption...
Persistent link: https://www.econbiz.de/10005084749