Credit Cycles Redux

Juan Cordoba and Marla Ripoll

Macroeconomics from University Library of Munich, Germany

Abstract: Theoretical studies have shown that under unorthodox assumptions on preferences and production technologies, collateral constraints can act as a powerful amplification and propagation mechanism of exogenous shocks. We investigate whether or not this result hold under more standard assumptions. We find that collateral constraints generate a typically small output amplification. Large amplification is a "knife- edge" type of result.

Keywords: Credit Constraints; financial constraints; business cycles; heterogenous agents; amplification (search for similar items in EconPapers)
JEL-codes: E32 E44 (search for similar items in EconPapers)
Pages: 35 pages
Date: 2002-10-16
New Economics Papers: this item is included in nep-dge
Note: Type of Document - pdf; pages: 35 ; figures: included
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

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Related works:
Working Paper: Credit Cycles Redux (2010)
Journal Article: CREDIT CYCLES REDUX (2004)
Working Paper: Credit Cycles Redux (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpma:0210004

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