• Recapitalization, Bailout, and Long-run Welfare in a Dynamic Model of Banking 

      Modena, Andrea (2021-03-01)
      This paper studies the dynamic trade-off between the short-run costs and the long-run benefits of bank bailouts. In the model, banks leverage thanks to their cost advantage at monitoring firms, but hold precautionary capital ...
    • The Collateralizability Premium 

      Ai, Hengjie; Li, Jun E.; Li, Kai; Schlag, Christian (2019-10-09)
      A common prediction of macroeconomic models of credit market frictions is that the tightness of financial constraints is countercyclical. As a result, theory implies a negative collateralizability premium, that is, capital ...