In a NK model with two types of rational agents, savers and capitalists, and non-maximizing banks, financial shocks do affect the macroeconomic dynamics depending on banks' behaviour as for their leverage ratio. We first show that the level of banks' leverage - which may be imposed by banks...

We analyse the redistribution channel of a money-financed versus debt-financed fiscal stimulus in a Borrower-Saver frammework. The redistribution channel is larger when we consider a money-financed fiscal stimulus. However, it generates also larger welfare losses than a debt-financed fiscal...

This paper analyzes the redistributive channel of a money financed fiscal stimulus (MFFS). It shows that the way in which this regime is implemented is crucial to determine its redistributive effects and consequently its effectiveness. In normal times, the most effective regime is a MFFS with no...