In this paper we construct sunspot equilibria that arise from chaotic deterministic dynamics. These equilibria are stationary and have absolutely continuous stationary measures. We prove that they can be learned by a simple rule based on the histograms of past state variables. This work gives a...

We study a two periods model of incomplete markets with nominal assets unsecured by collateral, where agents can go bankrupt but there are no bankruptcy penalties entering directly in the utility function. We address two cases: first, a proportional reimbursement rule under bounded short sales...

This study investigates the relationship between debtor punishment and the development of the credit market. We empirically analyze how the level of debtor punishment relates to the credit market expansion. We find evidence that an increase in debtor punishment tends to produce a positive effect...

Following Almeida, Campello and Weisbach (2003), we use the link between financial constraints and firm’s demand for liquidity to test the effect of financial constraints on firm policies in Brazil. The effect of financial constraints can be captured by a firm’s propensity to save cash out...

This study investigates the relationship between debtors? punishment and the credit market development. As the main goal we analyze empirically which is the optimal level of the debtors? punishment, providing the highest credit market development. Aligned with earlier theoretical findings from...