Negative shocks to housing, most households’ largest consumption good, are expected to create strong credit demand to smooth these shocks over time. We estimate and trace a credit demand curve for households who recently experienced a negative shock to their housing stock. We use...

I develop a framework of the buildup and outbreak of financial crises in an asymmetric information setting. In equilibrium, two distinct economic states arise endogenously: "normal times", periods of modest investment, and "booms", periods of expansionary investment. Normal times occur when the...

We use project-level information for the largest regional economic development program in German history to study how government subsidies to firms affect credit markets. We identify credit market responses by considering both, bank lending and firm borrowing during 1998-2019. We find that...