The reported study has two purposes: first, it attempts to improve the literature on foreign exchange interventions of the central banks for the emerging market economies, an area not previously studied in detail. The Turkish economy in the post-crisis period constitutes a good example in this...

We show that a model with imperfectly forecastable changes in future productivity and an occasionally-binding collateral constraint can match a set of stylized facts about Sudden Stop events. "Good" news about future productivity raises leverage during times of expansions, increasing the...

This paper develops a small open economy business cycle model with financial intermediaries (banks) in which banks' endogenous leverage constraints are occasionally binding. The model can account for financial crashes and sudden stops as a result of the amplification and asymmetry induced by the...

Following the financial crisis, total outstanding loans to businesses by commercial banks dropped off substantially. Large loans outstanding began to rebound by the third quarter of 2010 and essentially returned to their previous growth trajectory while small loans outstanding continued to...

Using prices of both S&P 500 options and recently introduced VIX options, we study asset pricing implications of volatility risk. While pointing out the joint pricing kernel is not identified nonparametrically, we propose model-free estimates of marginal pricing kernels of the market return and...