Entrepreneurship, financial frictions and the welfare gains of business cycles

dc.contributorEscolas::EESP
dc.creatorMerlin, Giovanni Tondin
dc.date.accessioned2018-08-28T14:07:11Z
dc.date.available2018-08-28T14:07:11Z
dc.date.created2018-08-28T14:07:11Z
dc.date.issued2018-08
dc.identifierTD 484
dc.identifierhttp://hdl.handle.net/10438/24629
dc.description.abstractI propose a simple method to solve a heterogeneous agent model with entrepreneurship, financial frictions and aggregate uncertainty. Aggregate shocks, in this context, induce potential entrepreneurs to save in order to slack their financial constraints, leading to a significant increase in aggregate savings, pushing up wages and lowering interest rates. This channel can be strong enough to more than offset the effect of fluctuations on consumption, leading to welfare gains of business cycles.
dc.languageeng
dc.relationEESP - Textos para Discussão; TD 484
dc.rightsopenAccess
dc.subjectHeterogeneous agents
dc.subjectEntrepreneurship
dc.subjectFinancial frictions
dc.subjectBusiness cycles
dc.subjectAggregate uncertainty
dc.titleEntrepreneurship, financial frictions and the welfare gains of business cycles
dc.typeWorking Paper


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