Series: IMF Working Papers
Author(s): Alberto Martin , and Jaume Ventura
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 09 June 2014
Keywords: rollover crises, secondary markets, crowding, capital stock, capital income, credit constraint, credit market, International Lending and Debt Problems, Financial Aspects of Economic Integration, Open Economy Macroeconomics
We study a dynamic economy where credit is limited by insufficient collateral and, as a result, investment and output are too low. In this environment, changes in investor sentiment or market expectations can give...