Template-Type: ReDIF-Paper 1.0
Author-Name: Antoni Bosch-Domènech
Author-Name-First: Antoni
Author-Name-Last: Bosch-Domènech
Author-Name: Joaquim Silvestre
Author-Name-First: Joaquim
Author-Name-Last: Silvestre
Author-Workplace-Name: Department of Economics, University of California Davis
Title: CREDIT CONSTRAINTS IN GENERAL EQUILIBRIUM: EXPERIMENTAL RESULTS
Abstract: Our work attempts to investigate the influence of credit tightness or expansion on activity and prices in a multimarket set-up. We report on some doubleauction, two-market experiments where subjects had to satisfy an inequality involving the use of credit. The experiments display two regimes. characterized by high and low credit availability. The critical vakre of credit at the common boundary of the two regimes has a compelling interpretation as the maximal credit use at the Arrow-Debreu equilibrium of the abstract economy naturally associated to our experimental environment. Our main results are that changes in the availability of credit: (a): have minor and unsystematic effects on real and nominal variables in the high-credit regime; (b): have substantial effects, both real and nominal, in the low-credit regime.
Length: 30
File-URL: https://repec.dss.ucdavis.edu/files/T9bzE18YkLtwieEB9qYWUVC2/95-7.pdf
File-Format: application/pdf
Number: 197
Classification-JEL: 
KeyWords: 
Creation-Date: 20040712
Handle: RePEc:cda:wpaper:197