On financial frictions and firm's market power.
There are two opposing welfare effects of market power in a model with monopolistic competition, loan defaults and moral hazard. The loss of output produced if firms set a higher mark‐up over marginal costs confronts with some gain due to higher expected profits and the reduction of defaults. Such t...
| Publicado en: | Economic Inquiry Vol. 61; no. 4; pp. 982 - 1006 |
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| Autores principales: | , , |
| Formato: | Artículo |
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Wiley-Blackwell
Oct2023
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| Materias: | |
| Acceso en línea: | Ver este registro en EBSCOhost |
| fields | @attributes: recordID: 1 pdfLink: plink: https://search.ebscohost.com/login.aspx?direct=true&db=ssf&AN=171312682&site=ehost-live header: @attributes: shortDbName: ssf uiTerm: 171312682 longDbName: Social Sciences Full Text (H.W. Wilson) uiTag: AN controlInfo: bkinfo: jinfo: jid: 00952583 EIQ jtl: Economic Inquiry issn: 00952583 maglogo: Y pubinfo: dt: Oct2023 vid: 61 iid: 4 pid: 480 pub: Wiley-Blackwell artinfo: ui: 171312682 10.1111/ecin.13146 ppf: 982 ppct: 24 formats: fmt: – @attributes: type: T – @attributes: type: C – @attributes: type: P size: 1.5MB tig: atl: On financial frictions and firm's market power. aug: au: Casares, Miguel Deidda, Luca G. Galdon‐Sanchez, Jose E. affil: Universidad Publica de Navarra, Pamplona, Spain Barnard College, New York City New York,, USA CRENoS and DISEA, Università di Sassari, Sassari, Italy su: Monopolistic competition Market power Default (Finance) Credit control Moral hazard sug: subj: Monopolistic competition Other Activities Related to Credit Intermediation Market power Default (Finance) Credit control Moral hazard keyword: credit rationing loan defaults market power credit rationing loan defaults market power ab: There are two opposing welfare effects of market power in a model with monopolistic competition, loan defaults and moral hazard. The loss of output produced if firms set a higher mark‐up over marginal costs confronts with some gain due to higher expected profits and the reduction of defaults. Such tradeoff results in an optimal level of market power that decreases with the efficiency of liquidation following default on a loan. If moral hazard is pervasive, credit rationing cuts down the default rates and mitigates the welfare cost of financial frictions. pubtype: Academic Journal doctype: Article src: R language: English refInfo: copyright: @attributes: flag: N holdings: @attributes: islocal: N |
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