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Macroeconomic Effects of Corporate Default Crises: A Long-Term Perspective

Longstaff, Francis A.; Giesecke, Kay; Schaefer, Stephen; … - National Bureau of Economic Research (NBER) - 2012

Using an extensive new data set on corporate bond defaults in the U.S. from 1866 to 2010, we study the macroeconomic effects of bond market crises and contrast them with those resulting from banking crises. During the past 150 years, the U.S. has experienced many severe corporate default crises...

Persistent link: https://www.econbiz.de/10009493261

Liaisons Dangereuses: Increasing Connectivity, Risk Sharing, and Systemic Risk

Delli Gatti, Domenico; Battiston, Stefano; Gallegati, Mauro - National Bureau of Economic Research (NBER) - 2009

an initial shock and lead to a full fledged systemic crisis. The results offer a simple possible explanation for the …

Persistent link: https://www.econbiz.de/10008627147

Bankruptcy and the Collateral Channel

Benmelech, Efraim; Bergman, Nittai K. - National Bureau of Economic Research (NBER) - 2010

Do bankrupt firms impose negative externalities on their non-bankrupt competitors? We propose and analyze a collateral channel in which a firm's bankruptcy reduces collateral values of other industry participants, thereby increasing the cost of external debt finance industry wide. To identify...

Persistent link: https://www.econbiz.de/10008627161

The Anatomy of a Residential Mortgage Crisis: A Look Back to the 1930s

Snowden, Kenneth A. - National Bureau of Economic Research (NBER) - 2010

Looking back to the 1930s provides the opportunity to examine one severe mortgage crisis as we live through another … occurred in the 1930s and the policy response of federal and state governments. The crisis reshaped the structure and …

Persistent link: https://www.econbiz.de/10008548788

Two Monetary Tools: Interest Rates and Haircuts

Ashcraft, Adam B.; Pedersen, Lasse Heje; Gârleanu, Nicolae - National Bureau of Economic Research (NBER) - 2010

We study a production economy with multiple sectors financed by issuing securities to agents who face capital constraints. Binding capital constraints propagate business cycles, and a reduction of the interest rate can increase the required return of high-haircut assets since it can increase the...

Persistent link: https://www.econbiz.de/10008534526

On the Size Distribution of Macroeconomic Disasters

Barro, Robert J.; Jin, Tao - National Bureau of Economic Research (NBER) - 2009

In the rare-disasters setting, a key determinant of the equity premium is the size distribution of macroeconomic disasters, gauged by proportionate declines in per capita consumption or GDP. The long-term national-accounts data for up to 36 countries provide a large sample of disaster events of...

Persistent link: https://www.econbiz.de/10005089155

Groupthink: Collective Delusions in Organizations and Markets

Benabou, Roland - National Bureau of Economic Research (NBER) - 2009

I develop a model of (individually rational) collective reality denial in groups, organizations and markets. Whether participants' tendencies toward wishful thinking reinforce or dampen each other is shown to hinge on a simple and novel mechanism. When an agent can expect to benefit from other's...

Persistent link: https://www.econbiz.de/10005588916

The Development of Opacity in U.S. Banking

Gorton, Gary - National Bureau of Economic Research (NBER) - 2013

War, to demand deposits and show that markets endogenous closed. The opacity of bank money in the recent financial crisis …

Persistent link: https://www.econbiz.de/10010796573

Unemployment Crises

Zhang, Lu; Petrosky-Nadeau, Nicolas - National Bureau of Economic Research (NBER) - 2013

A search and matching model, when calibrated to the mean and volatility of unemployment in the postwar sample, can potentially explain the large unemployment dynamics in the Great Depression. The limited response of wages to labor market conditions from credible bargaining and the congestion...

Persistent link: https://www.econbiz.de/10010675891

The "Other" Imbalance and the Financial Crisis

Caballero, Ricardo J - National Bureau of Economic Research (NBER) - 2010

One of the main economic villains before the crisis was the presence of large "global imbalances." The concern was that … recession. However, when the crisis finally did come, the mechanism did not at all resemble the feared sudden stop. Quite the … opposite, during the crisis net capital inflows to the U.S. were a stabilizing rather than a destabilizing source. I argue …

Persistent link: https://www.econbiz.de/10008610950