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Mixed signals : investment distortions with adverse selection

Darst, R. Matthew; Refayet, Ehraz - 2019

We study how adverse selection distorts equilibrium investment allocations in a Walrasian credit market with two-sided heterogeneity. Representative investor and partial equilibrium economies are special cases where investment allocations are distorted above perfect information allocations. By...

Persistent link: https://www.econbiz.de/10012181247

The impact of credit risk mispricing on mortgage lending during the subprime boom

Kahn, James A.; Kay, Benjamin S. - 2019

We provide new evidence that credit supply shifts contributed to the U.S. subprime mortgage boom and bust. We collect original data on both government and private mortgage insurance premiums from 1999-2016, and document that prior to 2008, premiums did not vary across loans with widely different...

Persistent link: https://www.econbiz.de/10012181334

Commodity prices and labour market dynamics in small open economies

Bodenstein, Martin; Kamber, Gunes; Thoenissen, Christoph - 2017

We investigate the connection between commodity price shocks and unemployment in advanced resource-rich small open economies from an empirical and theoretical perspective. Shocks to commodity prices are shown to influence labour market conditions primarily through the real exchange rate. The...

Persistent link: https://www.econbiz.de/10011709241

Optimal bank regulation in the presence of credit and run risk

Kashyap, Anil K.; Tsomocos, Dimitrios P.; Vardoulakis, … - 2017

We modify the Diamond and Dybvig (1983) model of banking to jointly study various regulations in the presence of credit and run risk. Banks choose between liquid and illiquid assets on the asset side, and between deposits and equity on the liability side. The endogenously determined asset...

Persistent link: https://www.econbiz.de/10011803125

Measuring inflation anchoring and uncertainty : a US and Euro area comparison

Grishchenko, Olesya; Mouabbi, Sarah; Renne, Jean-Paul - 2017

We use several US and euro-area surveys of professional forecasters to estimate a dynamic factor model of inflation featuring time-varying uncertainty. We obtain survey-consistent distributions of future inflation at any horizon, both in the US and the euro area. Equipped with this model, we...

Persistent link: https://www.econbiz.de/10011803186

The Great Recession and a missing generation of exporters

Lincoln, William F.; McCallum, Andrew H.; Siemer, Michael - 2017

The collapse of international trade surrounding the Great Recession has garnered significant attention. This paper studies firm entry and exit in foreign markets and their role in the post-recession recovery of U.S. exports using confidential microdata from the U.S. Census Bureau. We find that...

Persistent link: https://www.econbiz.de/10011803263

A global lending channel unplugged? : does U.S. monetary policy affect cross-border and affiliate lending by global U.S. banks?

Temesvary, Judit; Ongena, Steven; Owen, Ann L. - 2017

.S. bank-level regulatory dataset to assess at a quarterly frequency how changes in the U.S. Federal funds rate (before the … consistent with the existence of a potent global bank lending channel. In response to changes in U.S. monetary conditions, U ….S. banks strongly adjust their cross-border claims in both the pre and post-crisis period. However, we also find that U.S. bank …

Persistent link: https://www.econbiz.de/10011803798

The effect of interest rates on home buying : evidence from a discontinuity in mortgage insurance premiums

Bhutta, Neil; Ringo, Daniel - 2017

We study the effect of interest rates on the housing market by taking advantage of a sudden and unexpected price change in a large government mortgage program. The Federal Housing Administration (FHA) insures most mortgages to lower-downpayment, lower credit score borrowers, including a majority...

Persistent link: https://www.econbiz.de/10011710175

Improving the 30-year fixed-rate mortgage

Passmore, Stuart Wayne; Haften, Alexander H. von - 2017 - Current draft 8/18/2017

The 30-year fixed-rate fully amortizing mortgage (or "traditional fixed-rate mortgage") was a substantial innovation when first developed during the Great Depression. However, it has three major flaws. First, because homeowner equity accumulates slowly during the first decade, homeowners are...

Persistent link: https://www.econbiz.de/10011802976

End of an era : the coming long-run slowdown in corporate profit growth and stock returns

Smolyansky, Michael - 2023

Persistent link: https://www.econbiz.de/10014384512