We develop a model where agents can allocate their wealth between a liquid asset, which
can be used to purchase consumption goods, and an illiquid asset, which represents a …

Can there be too much trading in financial markets? We construct a dynamic general
equilibrium model, where agents face idiosyncratic liquidity shocks. A financial market …

A consistent empirical feature of bond yields is that term premia are, on average, positive.
The majority of theoretical explanations for this observation have viewed the term premia …

This paper examines the conceptual foundations of macroprudential policy by reviewing the
literature on financial frictions from a policy perspective that systematically links state …

This paper extends the interbank market model by Gale and Yorulmazer (2011) and
introduces randomized trading schemes in the form of lotteries. Gale and Yorul& mazer …