Empirical studies in corporate finance have long been focused on the role of banks in reducing the costs of financial distress. The environment and events in Japan provide a "natural experiment" that allows such empirical studies. The number of bankruptcies steadily increased throughout the...

This paper investigates the effects of money growth on nonconvergent dynamic paths in a money-in-utility model. When relative risk aversion is decreasing in money, period-two cycle and sunspot equilibria are always associated with a high rate of money supply growth. However, when relative risk...