Credit Rationing and Asset Value
AbstractThis paper investigates the effect of real assets as collateral on the economy. I construct a model that shows how credit rationing is mitigated by the existence of bad firms whether it is linked to the value of distressed assets. The model builds on Stiglitz and Weiss (1981) and Shleifer and Vishny (1992). The price of distressed assets is endogenous and it depends on the number of bad firms in the economy as well as on the liquidity of good firms. In the model it is possible to have a separating equilibrium only if there exists a number of bad firms.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by SIPI Spa in its journal Rivista di Politica Economica.
Volume (Year): 98 (2008)
Issue (Month): 3 (May-June)
Contact details of provider:
Other versions of this item:
- Antonio Affuso, 2007. "Credit Rationing and Asset Value," UNIMI - Research Papers in Economics, Business, and Statistics unimi-1065, Universitá degli Studi di Milano.
- A. Affuso, 2006. "Credit rationing and asset value," Economics Department Working Papers 2006-EP04, Department of Economics, Parma University (Italy).
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- A. Affuso, 2007. "Credit rationing and real assets: evidence from Italian panel data," Economics Department Working Papers 2007-EP09, Department of Economics, Parma University (Italy).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sabrina Marino).
If references are entirely missing, you can add them using this form.