Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/195167
Authors: 
Jackson, Paul
Madison, Florian
Year of Publication: 
2019
Series/Report no.: 
Working Paper 322
Abstract: 
We model entrepreneurial finance using a combination of fiat money, traditional bank loans, and home equity loans. The banking sector is over-the-counter, where bargaining determines the pass-through from the nominal interest rate to the bank lending rate, characterizing the transmission channel of monetary policy. The results show that the strength of this channel depends on the combination of nominal and real assets used to finance investments, and thus declines in the extent to which housing is accepted as collateral. A calibration to the U.S. economy supports the theoretical results and provides novel insights on entrepreneurial finance between 2000 and 2016.
Subjects: 
entrepreneurial finance
money
housing
collateral
monetary policy
JEL: 
E22
E40
E52
G31
R31
Document Type: 
Working Paper
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