Dewachter, Hans; Wouters, Raf - In: Journal of Economic Dynamics and Control 43 (2014) C, pp. 241-268
This paper proposes a perturbation-based approach to implement the idea of endogenous financial risk in a standard DSGE macro-model. Recent papers, such as Mendoza (2010), Brunnermeier and Sannikov (2012) and He and Krishnamurthy (2012), that have stimulated the research field on endogenous risk...