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We develop a tractable model of strategic debt renegotiation in which businesses are sequentially interconnected through their liabilities. This financing structure, which we refer to as a debt chain, gives rise to externalities as a lender’s willingness to provide concessions to his...
Persistent link: https://www.econbiz.de/10013242917
Employment rates in the United States fell dramatically between February 2020 and April 2020 as the repercussions of the COVID-19 pandemic reverberated through the labor market. This paper uses data from the CPS Basic Monthly Files to document that the employment decline was particularly severe...
Persistent link: https://www.econbiz.de/10012833081
estimate the size of the COVID-19-related unemployment shock to be between 2 and 5 times larger than the typical unemployment …We adopt a time series approach to investigate the historical relation between unemployment, life expectancy, and … shock, depending on race and gender, resulting in a significant increase in mortality rates and drop in life expectancy. We …
Persistent link: https://www.econbiz.de/10013247846
The covid-19 crisis has led to a sharp deterioration in firm and bank balance sheets. The government has responded with a massive intervention in corporate credit markets. We study equilibrium dynamics of macroeconomic quantities and prices, and how they are affected by government policy. The...
Persistent link: https://www.econbiz.de/10012833129
We estimate the impact of COVID-19 on business failures for small and medium sized enterprises (SMEs) using firm-level data in seventeen countries. Absent government support, the failure rate of SMEs would have increased by 9.1 percentage points, representing 4.6 percent of private sector...
Persistent link: https://www.econbiz.de/10013244116
portend longer-term ramifications for job losses and economic inequality …
Persistent link: https://www.econbiz.de/10012831845
calibrated by the cost of March 2020 Coronavirus relief packages, the shock is forecast to lead to a cumulative loss in … disaster shock on economic activity and on uncertainty is studied using a VAR. While past natural disasters are local in nature … of large disaster shocks. Even in a fairly conservative case where COVID-19 is a 5-month shock with its magnitude …
Persistent link: https://www.econbiz.de/10012837186
supply shocks are possible, under some conditions. A 50% shock that hits all sectors is not the same as a 100% shock that …
Persistent link: https://www.econbiz.de/10012837808
distribution of business revenue shock due to the Covid-19 pandemic. We rely on it to analyze the impact of business support …
Persistent link: https://www.econbiz.de/10012826132
shock caused by lockdowns, the idiosyncratic demand shock suffered by sectors that rely on high contact with their costumers … distribution is imposed on the Colombian data. As the crisis deepens, the risk of unemployment grows. However, informality rebounds …
Persistent link: https://www.econbiz.de/10012831281