Collateral Avoids Ponzi Schemes in Incomplete Markets

DOI10.1111/1468-0262.00343zbMath1141.91389OpenAlexW2009732773MaRDI QIDQ5475002

Juan Pablo Torres-Martínez, Mário Rui Rui Páscoa, Aloisio Pessoa de Araujo

Publication date: 16 June 2006

Published in: Econometrica (Search for Journal in Brave)

Full work available at URL: http://hdl.handle.net/10438/646

Mathematics Subject Classification ID

Auctions, bargaining, bidding and selling, and other market models (91B26)

Related Items (29)

Prices and investment with collateral and default ⋮ Equilibrium with limited-recourse collateralized loans ⋮ Intertemporal equilibrium with financial asset and physical capital ⋮ Making promises in infinite-horizon economies with default and collateral ⋮ Collateral once again ⋮ Collateral equilibrium. I: A basic framework ⋮ Complete markets with bankruptcy risk and pecuniary default punishments ⋮ Continuity of marketable payoffs with re-trading ⋮ Regulating collateral-requirements when markets are incomplete ⋮ Securities market theory: possession, repo and rehypothecation ⋮ Harsh default penalties lead to Ponzi schemes: a counterexample ⋮ Endogenous debt constraints in collateralized economies with default penalties ⋮ Capital Growth and Survival Strategies in a Market with Endogenous Prices ⋮ Long-lived collateralized assets and bubbles ⋮ Recourse loans and Ponzi schemes ⋮ On Ponzi schemes in infinite horizon collateralized economies with default penalties ⋮ Equilibrium in collateralized asset markets: credit contractions and negative equity loans ⋮ A frictionless economy with suboptimizing agents ⋮ Wealth transfers and the role of collateral when lifetimes are uncertain ⋮ Financial segmentation and collateralized debt in infinite-horizon economies ⋮ Collateralized assets and asymmetric information ⋮ The impossibility of effective enforcement mechanisms in collateralized credit markets ⋮ Patents as collateral ⋮ Statistical arbitrage with default and collateral ⋮ GENERAL AND PARTIAL EQUILIBRIA IN A CONSUMPTION ECONOMY ⋮ Harsh default penalties lead to Ponzi schemes ⋮ Recursive equilibrium in Krusell and Smith (1998) ⋮ Asset shortages, liquidity and speculative bubbles ⋮ A note on arbitrage and exogenous collateral

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