CEPR Discussion Paper – Overborrowing, Underborrowing, and Macroprudential Policy
Author(s):Fernando Arce, Julien Bengui, Javier Bianchi Date:July 2023 Abstract: In this paper, we revisit the scope for macroprudential policy in production economies with pecuniary externalities and collateral constraints. We study competitive equilibria and constrained-efficient equilibria and examine the extent to which the gap between the two depends on the production structure and the policy instruments[…]