Macro-Prudential Policy under Moral Hazard and Financial Fragility

Borradores de Economia
Number: 
878
Published: 
Classification JEL: 
G11, D86
Keywords: 
Human capital agglomeration, Social returns, Private returns, Externalities, Uncertainty, Fiscal policy
Download document

The most recent

The Economic Development of Colombia from the End of the Thousand Days' War to the Great Depression
Juliana Jaramillo-Echeverri, María Teresa Ramírez-Giraldo
Experimenting with Large Language Models for Inflation Forecasting in Colombia
Aarón Levi Garavito-Acosta, Wilmer Martinez-Rivera, Juan J. Ospina-Tejeiro, Edgar Caicedo-García
Evaluating Unemployment Insurance in a Developing Economy: Evidence from Colombia
Leonardo Fabio Morales, Diego Astorga-Rojas, Nicolas Guida-Johnson

This paper presents a DSGE model with banks that face moral hazard in management. Banks receive demand deposits and fund investment projects. Banks are subject to potential withdrawals by depositors which may force them into early liquidation of their inv