Endogenous information revelation in a competitive credit market and credit crunch

Li Y, Wigniolle B (2017)
JOURNAL OF MATHEMATICAL ECONOMICS 68: 127-141.

Download
No fulltext has been uploaded. References only!
Journal Article | Original Article | Published | English

No fulltext has been uploaded

Author
;
Abstract
In this paper, we propose a new mechanism able to explain the occurrence of credit crunches. Considering a credit market with an asymmetry of information between borrowers and lenders, we assume that borrowers have to pay a cost to reveal information on the quality of their project. They decide to be transparent if it is necessary for getting a loan or for paying a lower interest rate. Two types of competitive equilibria may exist: an opaque equilibrium in which all projects receive funding without revealing information; a transparent one in which only the best projects reveal information and receive funding. It is also possible to get multiple equilibria. Incorporating this microeconomic mechanism in an OLG model, the economy may experience fluctuations due to the change of regime, and indeterminacy may occur. (C) 2016 Elsevier B.V. All rights reserved.
Publishing Year
ISSN
PUB-ID

Cite this

Li Y, Wigniolle B. Endogenous information revelation in a competitive credit market and credit crunch. JOURNAL OF MATHEMATICAL ECONOMICS. 2017;68:127-141.
Li, Y., & Wigniolle, B. (2017). Endogenous information revelation in a competitive credit market and credit crunch. JOURNAL OF MATHEMATICAL ECONOMICS, 68, 127-141. doi:10.1016/j.jmateco.2016.09.008
Li, Y., and Wigniolle, B. (2017). Endogenous information revelation in a competitive credit market and credit crunch. JOURNAL OF MATHEMATICAL ECONOMICS 68, 127-141.
Li, Y., & Wigniolle, B., 2017. Endogenous information revelation in a competitive credit market and credit crunch. JOURNAL OF MATHEMATICAL ECONOMICS, 68, p 127-141.
Y. Li and B. Wigniolle, “Endogenous information revelation in a competitive credit market and credit crunch”, JOURNAL OF MATHEMATICAL ECONOMICS, vol. 68, 2017, pp. 127-141.
Li, Y., Wigniolle, B.: Endogenous information revelation in a competitive credit market and credit crunch. JOURNAL OF MATHEMATICAL ECONOMICS. 68, 127-141 (2017).
Li, Yuanyuan, and Wigniolle, Bertrand. “Endogenous information revelation in a competitive credit market and credit crunch”. JOURNAL OF MATHEMATICAL ECONOMICS 68 (2017): 127-141.
This data publication is cited in the following publications:
This publication cites the following data publications:

Export

0 Marked Publications

Open Data PUB

Web of Science

View record in Web of Science®

Search this title in

Google Scholar