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A General Equilibrium Analysis of Inflation and Microfinance in Developing Countries
Müller, Daniel - 2013
This paper analyses the welfare effects of microfinance and inflation in developing countries. Therefore, we introduce a moral hazard problem into a monetary search model with money and credit. We show how access to basic financial services affects households' decisions to borrow, to save and to...
Persistent link: https://www.econbiz.de/10011390685
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Consumer bankruptcy, mortgage default and labour supply
Li, Wenli; Meghir, Costas; Oswald, Florian - 2022
We specify and estimate a lifecycle model of consumption, housing demand and labor supply in an environment where individuals may file for bankruptcy or default on their mortgage. Uncertainty in the model is driven by house price shocks, education specific productivity shocks, and catastrophic...
Persistent link: https://www.econbiz.de/10013479037
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Optimal lender of last resort policy in different financial systems
Fecht, Falko; Tyrell, Marcel - 2004
In a framework closely related to Diamond and Rajan (2001) we characterize different financial systems and analyze the welfare implications of different LOLR-policies in these financial systems. We show that in a bank-dominated financial system it is less likely that a LOLR-policy that follows...
Persistent link: https://www.econbiz.de/10010295666
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Evaluation asset pricing models with limited commitment using household consumption data
Krueger, Dirk; Lustig, Hanno; Perri, Fabrizio - 2006
We evaluate the asset pricing implications of a class of models in which risk sharing is imperfect because of the limited enforcement of intertemporal contracts. Lustig (2004) has shown that in such a model the asset pricing kernel can be written as a simple function of the aggregate consumption...
Persistent link: https://www.econbiz.de/10010298336
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Centralized trading of corporate bonds
Huber, Samuel; Kim, Jaehong - 2015
In the post-crisis period, increased regulation of financial intermediaries led to a significant decline in corporate bond market liquidity. In order to stabilize these markets, policy makers recently proposed that the trading of corporate bonds should be more centralized. In this paper, we show...
Persistent link: https://www.econbiz.de/10011420570
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Consumer default with complete markets: Default-based pricing and finite punishment
Mateos-Planas, Xavier; Seccia, Giulio - 2013
This paper studies economies with complete markets where there is positive default on consumer debt. In a simple tractable two-period model, households can default partially, at a finite punishment cost, and competitive intermediaries price loans of different sizes separately. This environment...
Persistent link: https://www.econbiz.de/10010368154
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Endogenous incomplete markets, enforcement constraints, and intermediation
Abraham, Arpad; Carceles-Poveda, Eva - In: Theoretical Economics 1 (2006) 4, pp. 439-459
Alvarez and Jermann (2000) show that the constrained efficient allocations of endowment economies with imperfect risk sharing due to limited commitment can be decentralized as competitive equilibria with endogenous debt constraints that are not too tight. These are the loosest possible borrowing...
Persistent link: https://www.econbiz.de/10011599378
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Securitization and aggregate investment efficiency
Mirza, Afrasiab; Stephens, Eric - 2016
, which enables increased leverage and investment. In the absence of frictions in the securitization process, we show that the … be constrained inefficient due to the existence of a pecuniary externality that can result in over or under-investment …. We examine policies to correct over-investment and find that a leverage ratio restriction generates a Pareto improvement …
Persistent link: https://www.econbiz.de/10012058895
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Fear and market failure: Global imbalances and self-insurance”
Miller, Marcus; Zhang, Lei - 2007
This paper proposes an integrated framework to analyze jointly two key issues: the emergence of global imbalances and the precautionary motive for accumulating reserves. Standard models of general equilibrium would predict modest current account surpluses in the emerging markets if they face...
Persistent link: https://www.econbiz.de/10010278218
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Monetary Policy, Financial Constraints, and Redistribution
Loenser, Christian; Schabert, Andreas - 2020
This paper examines how financial constraints affect redistribution via monetary policy. We explore a novel mechanism of monetary non-neutrality, which is based on debt limits imposed in nominal terms. Specifically, when debt is constrained by current income, monetary policy can alter the real...
Persistent link: https://www.econbiz.de/10012290550