Working Paper
Indexed debt contracts and the financial accelerator
Abstract: This paper addresses the positive and normative implications of indexing risky debt to observable aggregate conditions. These issues are pursued within the context of the celebrated financial accelerator model of Bernanke, Gertler and Gilchrist (1999). The principal conclusions are that the optimal degree of indexation is significant, and that the business cycle properties of the model are altered under this level of indexation.
Keywords: Indexation (Economics); Financial markets;
Access Documents
File(s):
File format is application/pdf
https://www.clevelandfed.org/en/Newsroom%20and%20Events/Publications/Working%20Papers/~/media/225B198BF8044936B281CBF4B1E01A26.ashx
Description: Full text
Bibliographic Information
Provider: Federal Reserve Bank of Cleveland
Part of Series: Working Papers (Old Series)
Publication Date: 2011
Number: 1117