The possibility of default limits available liquidity. If the potential default draws nearer, a liquidity crisis may … subsequently materialize. Introducing default and limited collateral into general equilibrium theory (GE) allows for a theory of … endogenous contracts, including endogenous margin requirements on loans. This in turn allows GE to explain liquidity and …

The possibility of default limits available liquidity. If the potential default draws nearer, a liquidity crisis may … subsequently materialize. Introducing default and limited collateral into general equilibrium theory (GE) allows for a theory of … endogenous contracts, including endogenous margin requirements on loans. This in turn allows GE to explain liquidity and …

We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by … compute how the size of their loan or the price they quote might affect default rates. It also makes for a simple equilibrium … equilibrium always exists in our model, and that default, in conjunction with refinement, opens the door to a theory of endogenous …

We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by … their loan or the price they quote might affect default rates. The equilibrium refinement we propose, in order to rule out … refined equilibrium always exists in our model, and that default, in conjunction with refinement, opens the door to a theory …

We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by … compute how the size of their loan or the price they quote might affect default rates. It also makes for a simple equilibrium … equilibrium always exists in our model, and that default, in conjunction with refinement, opens the door to a theory of endogenous …

In our previous paper we built a general equilibrium model of default and punishment in which equilibrium always exists … sales constraints as equilibrium signals. By specializing the default penalties and imposing an exclusivity constraint on …

We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by … compute how the size of their loan or the price they quote might affect default rates. It also makes for a simple equilibrium … equilibrium always exists in our model, and that default, in conjunction with refinement, opens the door to a theory of endogenous …

We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment. The … exists, even with exclusivity constraints on asset sales, and transactions-liquidity costs or information-evaluation costs … for asset trade. We show that more lenient punishment which encourages default may be Pareto improving because it allows …

In our previous paper we built a general equilibrium model of default and punishment in which equilibrium always exists … sales constraints as equilibrium signals. By specializing the default penalties and imposing an exclusivity constraint on …