GERTLER, MARK; GILCHRIST, SIMON; NATALUCCI, FABIO M. - In: Journal of Money, Credit and Banking 39 (2007) 2-3, pp. 295-330
We develop a small open economy macroeconomic model where financial conditions influence aggregate behavior. Our goal is to explore the connection between the exchange rate regime and financial distress. We first show that a calibrated version of the model captures well the behavior of the...