Credit booms are not rare and usually precede financial crises. However, some end in a crisis (bad booms) while others … do not (good booms). We document that credit booms start with an increase in productivity, which subsequently falls much … faster during bad booms. We develop a model in which crises happen when credit markets change to an information regime with …

-pricing framework to value the systematic crash risk exposure of the collateral. We then apply Modigliani and Miller's (1958 … credit crisis of 2007-2008 …

Standard economic theory says that unsecured, high-interest, short-term debt -- such as borrowing via credit cards and … transitory income shock of unemployment. Instead, individuals smooth their credit card debt and overdrafts by adjusting … consumption. We first use detailed longitudinal information on debit and credit card transactions, account balances, and credit …

assets, based almost entirely on a credit risk criterion. The paper provides both a theoretical and empirical framework for … credit risk. For example, our findings indicate that the RBC weights overpenalize home mortgages, which have an average … credit loss of 13 basis points, relative to commercial and consumer loans. The RBC rules also contain a significant bias …

-constrained investors to take excessive risks. Ignored are unconstrained investors speculating on higher prices during credit booms. To … encouraged a bank/brokerage-credit-fueled stock-market bubble. The direct effect is a 25 cent increase in a stock's market …

of the collateral to the borrower without physically repossessing it. We explore the effect of this new form of credit …A new form of lending using digital collateral has recently emerged, most prominently in low and middle income … countries. Digital collateral (DC) relies on "lockout" technology, which allows the lender to temporarily disable the low value …

constrained-efficient allocation. The key as in general equilibrium theory is to extend the commodity space in such a way that …