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Uncertainty and the Cost of Bank vs. Bond Finance

Grimme, Christian - 2019

How does uncertainty affect the costs of raising finance in the bond market and via bank loans? Empirically, this paper finds that heightened uncertainty is accompanied by an increase in corporate bond yields and a decrease in bank lending rates. This finding can be explained with a model that...

Persistent link: https://www.econbiz.de/10012892132

Barriers to Global Capital Allocation

Pellegrino, Bruno; Spolaore, Enrico; Wacziarg, Romain T. - 2021

We quantify the impact of barriers to international investment, using a novel multi-country dynamic general equilibrium model with heterogeneous investors and imperfect capital mobility. Our model yields a gravity equation for bilateral foreign asset positions. We estimate this gravity equation...

Persistent link: https://www.econbiz.de/10013226659

When Pro-Poor Microcredit Institutions Favor Richer Borrowers - A Moral Hazard Story

Biancini, Sara; Venet, Baptiste; Ettinger, David - 2021

We suggest an explanation for the existence of “mission drift”, the tendency for Microfinance Institutions (MFIs) to lend money to wealthier borrowers rather than to the very poor. We focus on the relationship between MFIs and external funding institutions. We assume that both the MFIs and...

Persistent link: https://www.econbiz.de/10013245624

Stock Market's Assessment of Monetary Policy Transmission : The Cash Flow Effect

Gürkaynak, Refet S. - 2019

We show that firm liability structure and associated cash flow matter for firm behavior, and that financial market participants price stocks accordingly. Looking at firm level stock price changes around monetary policy announcements, we find that firms that have more cash flow exposure see their...

Persistent link: https://www.econbiz.de/10012860569

Monopolistic Competition, Optimum Product Diversity, and International Trade - the Role of Factor Endowment and Factor Intensities

Marjit, Sugata; Mandal, Biswajit - 2021

In this paper we revisit the influential theory of monopolistic competition and optimum product variety as developed by …

Persistent link: https://www.econbiz.de/10013215667

Does Energy Diversification Cause an Economic Slowdown? Evidence from a Newly Constructed Energy Diversification Index

Gozgor, Giray; Paramati, Sudharshan Reddy - 2021

system. Given this backdrop, this study introduces a new measure of energy diversification. It explores its impact on … economic growth with increasing long-run energy diversification. However, some countries (OECD and G20) experience negative … economic growth due to energy diversification in the short term. The results also disclosed that energy diversification does …

Persistent link: https://www.econbiz.de/10013215675

Asset Diversification Versus Climate Action

Hambel, Christoph - 2020

. In the longer run, however, a trade-off between diversification and climate action emerges. We derive the optimal carbon …

Persistent link: https://www.econbiz.de/10012825992

The Financial Channel of the Exchange Rate and Global Trade

Ma, Sai; Schmidt-Eisenlohr, Tim - 2023

This paper provides evidence that the U.S. dollar affects countries’ exports through the financial channel of the exchange rate (Bruno and Shin (2015)). Using global data on trade between countries whose currency is not the U.S. dollar, it documents a positive relationship between the dollar...

Persistent link: https://www.econbiz.de/10014347836

Five Facts About Beliefs and Portfolios

Giglio, Stefano - 2019

We administer a newly-designed survey to a large panel of retail investors who have substantial wealth invested in financial markets. The survey elicits beliefs that are crucial for macroeconomics and finance, and matches respondents with administrative data on their portfolio composition and...

Persistent link: https://www.econbiz.de/10012866380

The Seniority Structure of Sovereign Debt

Schlegl, Matthias - 2019

Sovereign governments owe debt to many foreign creditors and can choose which creditors to favor when making payments. This paper documents the de facto seniority structure of sovereign debt using new data on defaults (missed payments or arrears) and creditor losses in debt restructuring...

Persistent link: https://www.econbiz.de/10012870639