Drehmann, Mathias; Juselius, Mikael; Korinek, Anton - 2023
sizable real effects. The mechanism recognises that when there is long-term debt, an impulse to new borrowing generates a … predictable hump-shaped path of future debt service. We confirm this pattern using a novel multi-country dataset of debt flows …. Whereas new borrowing boosts output contemporaneously, debt service depresses output. Credit booms thus lead to predictable …