Abstract

ARANGO, Mauricio; POSADA, Carlos Esteban  and  TAMAYO, Jorge Andrés. Credit Market and Monetary Policy. Ens. polit. econ. [online]. 2011, vol.29, n.spe64, pp.32-61. ISSN 0120-4483.

The credit market has played an important role in the recent financial crisis and recession of the U. S. economy. Looking for an explanation about it we built and used a macroeconomic model with a credit market to describe a GDP cycle and a rise and decline of the collateralized asset price related to banking and monetary policies. This paper presents the model and several simulations from it to assess the roles of each one.

Keywords : business cycles; bubbles; credit constraints; collateral constraint; monetary policy.

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