Structural reforms in a debt overhang

• 成果类型: Article
• 署名作者: Andres, Javier; Arce, Oscar; Thomas, Carlos
• 署名单位: University of Valencia; Banco de Espana
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2017.05.004
• 发表日期: 2017
• 页码: 15-34
• 关键词: Deleveraging; collateral constraints; Long-run debt; structural reforms

摘要

The effects of reforms in product and labor markets are assessed in an economy where credit restrictions and long-term debt combine to produce a persistent recession with slow deleveraging following a negative financial shock. We show that product market reforms stimulate output and employment even in the short run, despite their deflationary effects. By favoring a faster recovery of investment and collateral values, such reforms bring forward the end of the deleveraging phase. This channel is missing in the case of labor market reforms, which have more modest effects on economic activity. (C) 2017 Elsevier B.V. All rights reserved.