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-based financial market model ; leverage ; macroprudential regulation ; financial stability ; asset price bubbles ; systemic risk …
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During the last two decades, the degree of openness of national financial systems has increased substantially. At the same time, asymmetries in information and other financial market frictions have remain prevalent. We study both empirically and theoretically the implications of the opening up...
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investment decisions play with regard to business cycle fluctuations.<br><br>However, the inclusion of real option values in … crisis. Within a partial investment model, two kinds of uncertainty are introduced: volatility and disaster risk. The article … expands the literature by integrating a jump-diffusion process into an entry-exit framework for investment decisions. In …
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This paper investigates the role of credit market size as a determinant of business cycle fluctuations. First, using OECD data I document that credit market depth mitigates the impact of variations in productivity to output volatility. Then, I use a business cycle model with borrowing limits a...
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