Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/144572
Authors: 
Giorgadze, Tamar
Vasilev, Aleksandar
Year of Publication: 
2016
Abstract: 
The paper examines that imperfections in financial markets are themselves a source of macroeconomic fluctuations. Small, temporary shocks to technology or income distribution can generate large fluctuations in output and asset prices and spill over to other sectors. The work is based on the original model by Kiyotaki and Moore (1997). This paper will simulate a one-unit technology shock and study the propagation through the credit channel, evaluating its quantitative impact. While in the Kiyotaki-Moore model there is a linear production function used, we will try to do the derivation using the non-linear function and analyze how it changes the previously obtained result.
Subjects: 
Credit cycles
aggregate fluctuations
JEL: 
E32
Document Type: 
Research Report

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