Credit market imperfections influence the labor market and aggregate economic activity. In turn, macroeconomic factors have an impact on the credit sector. To assess these effects in a tractable general-equilibrium framework, we introduce endogenous search frictions, in the spirit of Peter...

This paper provides empirical evidence on the effects of financial repression on government finances. Financial repression is a combination of controls on international capital flows with restrictions on domestic interest rates. The result is an artificially low cost of domestic funding to...