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  • Shengxing Zhang

    (New York University)

  • Fernando Martin

    (Federal Reserve Bank of St. Louis)

  • David Andolfatto

    (Federal Reserve Bank of St. Louis)


Rehypothecation refers to the practice of reusing (selling or pledging as collateral) an asset that has already been pledged as collateral for a cash loan. In high inflation economies, rehypothecation improves economic welfare, but there is generally too much of it. We find that regulatory constraints that limit the practice generally serve to improve economic welfare.

Suggested Citation

  • Shengxing Zhang & Fernando Martin & David Andolfatto, 2014. "Rehypothecation," 2014 Meeting Papers 806, Society for Economic Dynamics.
  • Handle: RePEc:red:sed014:806

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    Cited by:

    1. Piero Gottardi & Vincent Maurin & Cyril Monnet, 2019. "A theory of repurchase agreements, collateral re-use, and repo intermediation," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 33, pages 30-56, July.

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