Collateral Constraints and Legal Protection of Lenders: A Macroeconomic Perspective

Kunieda, Takuma and Shibata, Akihisa (2011): Collateral Constraints and Legal Protection of Lenders: A Macroeconomic Perspective.

Abstract

We identify countries that establish collateral-based lending systems with a small-open-economy version of Nobuhiro Kiyotaki and John Moore’s (1997) model. We find that 47 countries in 1980s and 48 countries in 1990s out of 98 countries establish collateral-based lending systems. We also investigate the origin of collateral-based lending systems and find that if a country offers good legal protection for lenders, then a collateral-based lending system is more likely to be embedded in that country.

• Item Type: MPRA Paper
• Language: English
• Keywords: Credit constraints; Collateral-based lending; Legal protection of lenders; Kiyotaki-Moore model
• Subjects: E - Macroeconomics and Monetary Economics > E5 - Monetary Policy, Central Banking, and the Supply of Money and Credit > E51 - Money Supply ; Credit ; Money Multipliers; F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F41 - Open Economy Macroeconomics; K - Law and Economics > K1 - Basic Areas of Law > K10 - General; E - Macroeconomics and Monetary Economics > E1 - General Aggregative Models > E10 - General

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