Data di Pubblicazione:
2016
Abstract:
We consider a DSGE model with monopolistically competitive banks together with Q1
endogenous firms’ entry. We find that our model implies higher volatilities of both real
and financial variables than those implied by a DSGE model with a monopolistic banking
sector and a fixed number of firms. The response of the economic activity is also more
persistent in response to all shocks. Furthermore, we show that inefficient banks enhance
the endogenous propagation of the shocks with respect to a model where banks compete
under perfect competition and can fully ensure against the risk of firms’ default.
endogenous firms’ entry. We find that our model implies higher volatilities of both real
and financial variables than those implied by a DSGE model with a monopolistic banking
sector and a fixed number of firms. The response of the economic activity is also more
persistent in response to all shocks. Furthermore, we show that inefficient banks enhance
the endogenous propagation of the shocks with respect to a model where banks compete
under perfect competition and can fully ensure against the risk of firms’ default.
Tipologia CRIS:
1.1 Articolo in rivista
Keywords:
Firms’ Endogenous Entry, Firms’ Dynamics, Monopolistic Banking, Inefficient Financial Markets
Elenco autori:
Rossi, Lorenza; Carla La, Croce
Link alla scheda completa:
Pubblicato in: