Search Results - subject:"Borrowing constraints"

Current accounts dynamics in OECD and EU acceding countries

Bussière, Matthieu; Fratzscher, Marcel; Müller, Gernot J. - 2004

The paper extends the standard intertemporal model of the current account to include two important stylised facts: (1) the persistence of current account positions and (2) the relevance of the fiscal balance. Specifically, the paper derives a closed form solution for consumption in the presence...

Persistent link: https://www.econbiz.de/10009636534

Debt-Constraints or Incomplete Markets? A Decomposition of the Wealth and Consumption Inequality in the U.S.

Cordoba, Juan-Carlos - EconWPA - 2004

The large wealth and consumption inequality in the U.S. is usually attributed to two market frictions: debt constraints and incomplete markets. Recent literature has argued that debt constraints are the critical friction while market incompleteness plays only a secondary role. We evaluate the...

Persistent link: https://www.econbiz.de/10005412632

Social Security Reform with Uninsurable Income Risk and Endogenous Borrowing Constraints

Rojas, Juan; Urrutia, Carlos - EconWPA - 2004

the agents' incentives to default on previous debts. We find that a model with exogenous borrowing constraints … endogenizing borrowing constraints is reduced. …

Persistent link: https://www.econbiz.de/10005076677

Pension Reform and Endogenous Borrowing Constraints

Rojas, Juan; Urrutia, Carlos - Society for Economic Dynamics - SED - 2004

first is the standard one characterized by exogenous borrowing constraints. In the second one, because of the lack of … borrowing constraints are exogenous, changing the social security replacement rate from 44% to 0% increases the capital … contrast, when the borrowing constraints are endogenous, such policy change would increase the aggregate capital stock and the …

Persistent link: https://www.econbiz.de/10005085441

Consumption Smoothing and the Structure of Labor and Credit Markets

Bertola, Giuseppe; Koeniger, Winfried - Institute for the Study of Labor (IZA) - 2004

income mobility have smaller beneficial effects for currently poor workers when borrowing constraints are binding. These …

Persistent link: https://www.econbiz.de/10005700925

International Capital Mobility and Aggregate Volatility: the Case of Credit-Rationed Open Economies

Pintus, Patrick - Society for Computational Economics - SCE - 2004

This paper studies how international capital mobility affects aggregate volatility by considering the case of imperfect financial markets such that only physical capital serves as collateral for international borrowing, whereas human capital cannot. We find that credit-rationed, small open...

Persistent link: https://www.econbiz.de/10005345269

Market imperfections, equilibrium and arbitrage

Jouini, Elyès - EconWPA - 2003

The theory of asset pricing, which takes its roots in the Arrow-Debreu model (Theory of value [1959, chap. 7]), the Black and Sholes formula (1973) and Cox and Ross (1976 a and b), has been formalized in a general framework by Harrison and Kreps (1979), Harrison and Pliska (1979) and Kreps...

Persistent link: https://www.econbiz.de/10005076947

Risk Aversion and Optimal Portfolio Policies in Partial and General Equilibrium Economies

Kogan, Leonid; Uppal, Raman - C.E.P.R. Discussion Papers - 2002

exchange economy with multiple agents who differ in their degree of risk aversion and face borrowing constraints. We …

Persistent link: https://www.econbiz.de/10005504284

Household Risk Management and Optimal Mortgage Choice

Campbell, John; Cocco, Joao F. - Society for Computational Economics - SCE - 2002

Persistent link: https://www.econbiz.de/10005537670

Debt reduction and automatic stabilisation

Hiebert, Paul; Pérez, Javier J.; Rostagno, Massimo - Centro de Estudios Andaluces, Government of Andalusia - 2002

This paper presents an optimal fiscal policy response to address the basic tradeoff between the automatic stabilisation properties of budgets and the long run fiscal positions. The framework is an overlapping generations model `a la Weil (1989), extended to account for stochastic endowments and...

Persistent link: https://www.econbiz.de/10005157552