Macro-Finance /
Cochrane, John H.
Macro-Finance / John H. Cochrane. - Cambridge, Mass. National Bureau of Economic Research 2016. - 1 online resource: illustrations (black and white); - NBER working paper series no. w22485 . - Working Paper Series (National Bureau of Economic Research) no. w22485. .
August 2016.
Macro-finance addresses the link between asset prices and economic fluctuations. Many models reflect the same rough idea: the market's ability to bear risk varies over time, larger in good times, and less in bad times. Models achieve this similar result by quite different mechanisms, and I contrast their strengths and weaknesses. I outline how macro-finance models may illuminate macroeconomics, by putting time-varying risk aversion, risk-bearing capacity, and precautionary savings at the center of recessions rather than variation in "the" interest rate and intertemporal substitution. I emphasize unsolved questions and profitable avenues for research.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.
Macro-Finance / John H. Cochrane. - Cambridge, Mass. National Bureau of Economic Research 2016. - 1 online resource: illustrations (black and white); - NBER working paper series no. w22485 . - Working Paper Series (National Bureau of Economic Research) no. w22485. .
August 2016.
Macro-finance addresses the link between asset prices and economic fluctuations. Many models reflect the same rough idea: the market's ability to bear risk varies over time, larger in good times, and less in bad times. Models achieve this similar result by quite different mechanisms, and I contrast their strengths and weaknesses. I outline how macro-finance models may illuminate macroeconomics, by putting time-varying risk aversion, risk-bearing capacity, and precautionary savings at the center of recessions rather than variation in "the" interest rate and intertemporal substitution. I emphasize unsolved questions and profitable avenues for research.
System requirements: Adobe [Acrobat] Reader required for PDF files.
Mode of access: World Wide Web.