The price of capital and the financial accelerator

被引：2
|
作者：
Pancrazi, Roberto [1 ]
Seoane, Hernan D. [2 ]
Vukotic, Marija [1 ]
机构：
[1] Univ Warwick, Dept Econ, Coventry CV4 7AL, W Midlands, England
[2] Univ Carlos III Madrid, Dept Econ, Calle Madrid 126, Madrid 28903, Spain
来源：
ECONOMICS LETTERS | 2016年 / 149卷
关键词：
Financial accelerator; Business fluctuations; Investment adjustment cost; OPTIMAL-CONTRACTS;
D O I：
10.1016/j.econlet.2016.10.022
中图分类号：
F [经济];
学科分类号：
02 ;
摘要：
The price of capital is a key determinant of the financial accelerator, a transmission mechanism of shocks generated through the capital accumulation process of entrepreneurs that borrow in credit markets with frictions. This paper shows that the procedure of approximating the price of old capital by the net-of-depreciation price of new capital, as used in many articles since Bernanke et al. (1999), has profound implications when the capital depreciation rate is positive. When accounting for the appropriate price of capital, the effects of the financial accelerator are even stronger than originally assessed. (C) 2016 Elsevier B.V. All rights reserved.
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页码：86 / 89
页数：4
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