We assess the quantitative implications of the re-use of collateral on financial market leverage, volatility, and …-use frees up collateral that can be used to back more transactions. Re-use thus contributes to the build-up of leverage and … lead to excessive leverage and lower welfare. So the analysis in this paper provides a rationale for limiting, yet not …

, leverage, heterogeneous agents, endogenous margins, regulated collateral …In this paper we examine the effect of collateral requirements on the prices of long-lived assets. We consider a Lucas …-style infinite-horizon exchange economy with heterogeneous agents and collateral constraints. There are two trees in the economy …

general equilibrium in finite-horizon economy with heterogeneous agents and collateral constraints. There are two assets in … the economy which can be used as collateral for short-term loans. For the first asset the margin requirement is … presence of collateral constraints leads to strong excess volatility. Thus, a regulation of margin requirements may have …

agents, arbitrage activity has an impact on the price level and generates both excess volatility and the leverage effect. We …