Equilibrium determines leverage, not just interest rates. Variations in leverage cause fluctuations in asset prices. This leverage cycle can be damaging to the economy, and should be regulated.Leverage, Collateral, Cycle, Crisis, Regulation

John Geanakoplos

English

Research Papers in Economics

Collateral Restrictions and Liquidity under-Supply:

Collateralized Security Markets&quot;, unpublished. Earlier versions

Equilibrium and welfare in markets with ﬁnancially consrained arbitrageurs&quot;

Existence, Regularity, and Constrained Suboptimality of Competitive Allocations when the Asset Market is Incomplete&quot;

Financial Innovation and Risk Sharing.

Flight to Quality, Flight to Liquidity, and the Pricing of Risk.” Unpublished.

Forthcoming in the

Ineﬃcient Credit Booms&quot;. Review of Economic Studies,

International and Domestic Collateral Constraints in a

Leverage Cycles and the Anxious Economy” American Economic Review

Leverage, Incomplete Markets, and Pareto Improving Regulation&quot;,

Liquidity, Default, and Crashes: Endogenous Contracts in General Equilibrium.”

Market Liquidity and Funding Liquidity.”Review of Financial Studies,

The Financial Accelerator in a Quantitative Business Cycle Framework&quot;,

The Leverage Cycle

http://cowles.econ.yale.edu/P/cd/d17a/d1715.pdf

The Leverage Cycle

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Research Papers in Economics