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Some Reflections on the Recent Financial Crisis

Gorton, Gary - National Bureau of Economic Research (NBER) - 2012

Economic growth involves metamorphosis of the financial system. Forms of banks and bank money change. These changes, if not addressed, leave the banking system vulnerable to crisis. There is no greater challenge in economics than to understand and prevent financial crises. The financial crisis...

Persistent link: https://www.econbiz.de/10010950636

The Financial Accelerator in a Quantitative Business Cycle Framework

Bernanke, Ben S.; Gertler, Mark; Gilchrist, Simon - National Bureau of Economic Research (NBER) - 1998

This paper develops a dynamic general equilibrium model that is intended to help clarify the role of credit market … developments in credit markets work to amplify and propagate shocks to the macroeconomy. In addition, we add several features to … allows us to study how credit market frictions may influence the transmission of monetary policy. In addition, we allow for …

Persistent link: https://www.econbiz.de/10005088807

Collective Risk Management in a Flight to Quality Episode

Caballero, Ricardo J; Krishnamurthy, Arvind - National Bureau of Economic Research (NBER) - 2007

We present a model of optimal intervention in a flight to quality episode. The reason for intervention stems from a collective bias in agents' expectations. Agents in the model make risk management decisions with incomplete knowledge. They understand their own shocks, but are uncertain of how...

Persistent link: https://www.econbiz.de/10005085158

Financial Frictions, Investment and Tobin's q

Walentin, Karl; Lorenzoni, Guido - National Bureau of Economic Research (NBER) - 2007

We develop a model of investment with financial constraints and use it to investigate the relation between investment and Tobin's q. A firm is financed partly by insiders, who control its assets, and partly by outside investors. When their wealth is scarce, insiders earn a rate of return higher...

Persistent link: https://www.econbiz.de/10005588901

Intertemporal Disturbances

Primiceri, Giorgio; Tambalotti, Andrea; Schaumburg, Ernst - National Bureau of Economic Research (NBER) - 2006

Disturbances affecting agents intertemporal substitution are the key driving force of macroeconomic fluctuations. We reach this conclusion exploiting the bond pricing implications of an estimated general equilibrium model of the U.S. business cycle with a rich set of real and nominal frictions.

Persistent link: https://www.econbiz.de/10005710878

Flight to Quality and Collective Risk Management

Caballero, Ricardo J; Krishnamurthy, Arvind - National Bureau of Economic Research (NBER) - 2006

We present a model of flight to quality episodes that emphasizes systemic risk and the Knightian uncertainty surrounding these episodes. Agents make risk management decisions with incomplete knowledge. They understand their own shocks, but are uncertain of how correlated their shocks are with...

Persistent link: https://www.econbiz.de/10005718251

Financial System Risk and Flight to Quality

Caballero, Ricardo J; Krishnamurthy, Arvind - National Bureau of Economic Research (NBER) - 2005

We present a model of flight to quality episodes that emphasizes financial system risk and the Knightian uncertainty surrounding these episodes. In the model, agents are uncertain about the probability distribution of shocks in markets different from theirs, treating such uncertainty as...

Persistent link: https://www.econbiz.de/10005718486

Accounting for Incomplete Pass-Through

Nakamura, Emi; Zerom, Dawit - National Bureau of Economic Research (NBER) - 2009

Recent theoretical work has suggested a number of potentially important factors in causing incomplete pass-through of exchange rates to prices, including markup adjustment, local costs and barriers to price adjustment. We empirically analyze the determinants of incomplete pass-through in the...

Persistent link: https://www.econbiz.de/10004976948

Monetary Non-Neutrality in a Multi-Sector Menu Cost Model

Nakamura, Emi; Steinsson, Jon - National Bureau of Economic Research (NBER) - 2008

Empirical evidence suggests that as much as 1/3 of the U.S. business cycle is due to nominal shocks. We calibrate a multi-sector menu cost model using new evidence on the cross-sectional distribution of the frequency and size of price changes in the U.S. economy. We augment the model to...

Persistent link: https://www.econbiz.de/10004976950

Prices and Supply Disruptions during Natural Disasters

Cavallo, Alberto Felipe; Rigobon, Roberto; Cavallo, Eduardo - National Bureau of Economic Research (NBER) - 2013

We study the daily behavior of supermarket prices and product availability following two recent natural disasters: the 2010 earthquake in Chile and the 2011 earthquake in Japan. In both cases there was an immediate and persistent effect on product availability. The number of goods available for...

Persistent link: https://www.econbiz.de/10011105941