Supplement to "Global Banks and Systemic Debt Crises"

In this Appendix, we develop and solve an extension of the baseline model in which we allow for trading of securities in secondary markets. This version of the model features the same source of variation as in the empirical analysis. We show that a parameterization of the model that targets cross-sectional empirical estimates from the data delivers quantitative results similar to those in the baseline model.

Morelli, Juan M., Pablo Ottonello, and Diego J. Perez
Online Appendix

Back