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dc.contributor.author Asriyan, Vladimir
dc.contributor.author Laeven, Luc
dc.contributor.author Martín, Alberto
dc.date.accessioned 2023-11-23T12:03:31Z
dc.date.available 2023-11-23T12:03:31Z
dc.date.issued 2022
dc.identifier.citation Asriyan V, Laeven L, Martín A. Collateral booms and information depletion. Rev Econ Stud. 2022 Mar;89(2):517-55. DOI: 10.1093/restud/rdab046
dc.identifier.issn 0034-6527
dc.identifier.uri http://hdl.handle.net/10230/58364
dc.description Includes replication files.
dc.description.abstract We develop a new theory of information production during credit booms. Entrepreneurs need credit to undertake investment projects, some of which enable them to divert resources. Lenders can protect themselves from such diversion in two ways: collateralization, and costly screening that generates durable information about projects. In equilibrium, the collateralization-screening mix depends on the value of aggregate collateral. High collateral values make it possible to reallocate resources towards productive projects, but they also crowd out screening. This has important dynamic implications. During credit booms driven by high collateral values (e.g. real estate booms), economic activity expands but the economy’s stock of information on existing projects gets depleted. As a result, collateral-driven booms end in deep crises and slow recoveries: when booms end, investment is constrained both by the lack of collateral and by the lack of information on existing projects, which takes time to rebuild. We provide empirical support for the mechanism using US firm-level data.
dc.format.mimetype application/pdf
dc.language.iso eng
dc.publisher Oxford University Press
dc.relation.ispartof The Review of Economic Studies. 2022 Mar;89(2):517-55
dc.relation.isreferencedby http://dx.doi.org/10.5281/zenodo.4763138
dc.rights © The Author(s) 2021. Published by Oxford University Press on behalf of The Review of Economic Studies Limited. This is an Open Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License (http://creativecommons.org/licenses/by-nc/4.0/), which permits non-commercial re-use, distribution, and reproduction in any medium, provided the original work is properly cited.
dc.rights.uri http://creativecommons.org/licenses/by-nc/4.0/
dc.title Collateral booms and information depletion
dc.type info:eu-repo/semantics/article
dc.identifier.doi http://dx.doi.org/10.1093/restud/rdab046
dc.subject.keyword Credit booms
dc.subject.keyword Collateral
dc.subject.keyword Information production
dc.subject.keyword Crises
dc.subject.keyword Bubbles
dc.subject.keyword Misallocation
dc.rights.accessRights info:eu-repo/semantics/openAccess
dc.type.version info:eu-repo/semantics/publishedVersion

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