Borrowing constraints and complex dynamics in an OLG framework
In this paper we model an OLG economy à la Kiyotaki and Moore whose novel feature is the role of money as a store of value and of bequest as a source of funds to be "invested" in landholding. The dynamics generated by the model are generally characterized by irregular cyclical trajectories and, under special configuration of the parameters, a strange attractor appears. In this setting, an expansionary monetary policy may have a stabilizing role due to the interaction between money holding and the accumulation of borrowers' net worth.
Year of publication: |
2009
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Authors: | Assenza, Tiziana ; Agliari, Anna ; Delli Gatti, Domenico ; Santoro, Emiliano |
Published in: |
Journal of Economic Behavior & Organization. - Elsevier, ISSN 0167-2681. - Vol. 72.2009, 2, p. 656-669
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Publisher: |
Elsevier |
Keywords: | Borrowing constraints Credit cycles Complex dynamics Monetary policy |
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