Benhima, Kenza - National Centre of Competence in Research - Financial … - 2011
, the following facts can be replicated: 1)persistent current account surpluses and 2) high TFP growth in China. Because … ofliquidity shocks and credit constraints, investment by entrepreneurs with long-termprojects is depressed. The behavior of these … entrepreneurs has two other importantfeatures: (i) their demand for bonds is "excessive"; (ii) bonds and long-term invest-ment are …