Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/106212 
Year of Publication: 
2014
Series/Report no.: 
FinMaP-Working Paper No. 24
Publisher: 
Kiel University, FinMaP - Financial Distortions and Macroeconomic Performance, Kiel
Abstract: 
TWe allow for heterogeneity in investors' ability to borrow from collateral in a Kiyotaki-Moore style macro model. We calibrate the model to match the quintiles of the distri- bution of leverage ratios of US non-financial firms. We show that financial amplification of the model with heterogeneous investors can be orders of magnitude higher, because of more pronounced asset price reactions.
Subjects: 
Collateral Constraints
Leverage
Heterogeneity
Financial Amplification
JEL: 
E32
E44
Document Type: 
Working Paper

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