Modeling sudden stops: The non-trivial role of preference specifications

Suparna Chakraborty

Economics Letters, 2009, vol. 104, issue 1, pages 1-4

Abstract: A puzzling ambiguity in current international economics literature is the link between sudden stops and output drops. While some studies predict the link, others find sudden stops lead to output increases. This paper theoretically shows that the ambiguity results from alternative preference specifications.

Keywords: Sudden; stops; General; equilibrium; Borrowing; constraints; Preference; specifications; Wealth; effects (search for similar items in EconPapers)
Date: 2009

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Persistent link: http://EconPapers.repec.org/RePEc:eee:ecolet:v:104:y:2009:i:1:p:1-4

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