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I study a general equilibrium menu cost model with a continuum of sectors, idiosyncratic and aggregate shocks, and the novel feature that each sector consists of strategically engaged firms. Compared to an economy with monopolistically competitive sectors—separately parameterized to match the...
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reliant on bank credit. The credit channel theory states that, for small enterprises, a stricter monetary policy stance …
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heavily reliant on bank credit. The credit channel theory states that, for small enterprises, a stricter monetary policy …
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