Liquidity Traps and Monetary Policy: Managing a Credit Crunch
Francisco Buera and
Juan Pablo Nicolini
American Economic Journal: Macroeconomics, 2020, vol. 12, issue 3, 110-38
Abstract:
We study a model with heterogeneous producers that face collateral and cash-in-advance constraints. A tightening of the collateral constraint results in a credit-crunch-generated recession that reproduces some features of the financial crisis that unraveled in 2007 in the United States. We use the model to study the effects, following a credit crunch, of alternative monetary and fiscal policies.
JEL-codes: E31 E44 E52 E62 G01 H63 (search for similar items in EconPapers)
Date: 2020
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Related works:
Working Paper: Liquidity Traps and Monetary Policy: Managing a Credit Crunch (2017) 
Working Paper: Liquidity Traps and Monetary Policy: Managing a Credit Crunch (2016) 
Working Paper: Liquidity Traps and Monetary Policy: Managing a Credit Crunch (2014) 
Working Paper: Liquidity Traps and Monetary Policy: Managing a Credit Crunch (2014) 
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Persistent link: https://EconPapers.repec.org/RePEc:aea:aejmac:v:12:y:2020:i:3:p:110-38
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DOI: 10.1257/mac.20170040
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