Private and government banks : a DSGE approach

This paper studies the role of public banks in a Dynamic Stochastic General Equilibrium (DSGE) model with heterogeneous financial intermediaries. In accordance with the empirical literature on the subject, this study shows that the presence of public banks alter the reaction of the aggregate variables to negative shocks relative to standard DSGE models. Namely, the economy is able to recover faster following negative shocks due to the less pro cyclical behavior of government banks. The paper shows that ignoring this dimension of heterogeneity may render misleading assessments and conclusions regarding economic variables like GDP, consumption, investment, labor, etc.

Department dc:contributor.department

Sloan School of Management.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2017

Author dc:creator

• Montecinos Bravo, Alexis

Advisor dc:contributor.advisor

• Deborah J. Lucas.

• Sloan School of Management.

Statement dc:rights

• MIT theses are protected by copyright. They may be viewed, downloaded, or printed from this source but further reproduction or distribution in any format is prohibited without written permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/113951

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/113951