Macroeconomics and Financial Crises: Bound Together by Information Dynamics Gorton Gary B.
Macroeconomics and Financial Crises: Bound Together by Information Dynamics Gorton Gary B. How financial crises are inherent features of macroeconomic dynamicsThere are no bigger disruptions in the…
Specifikacia Macroeconomics and Financial Crises: Bound Together by Information Dynamics Gorton Gary B.
Macroeconomics and Financial Crises: Bound Together by Information Dynamics Gorton Gary B.
How financial crises are inherent features of macroeconomic dynamicsThere are no bigger disruptions in the functioning of economies than financial crises. Macroeconomics and Financial Crises rethinks how technological change, credit booms, and endogenous information production combine to generate financial crises as inherent and recurrent reactions to macroeconomic dynamics.Gary Gorton and Guillermo Ordoez identify short-term debt, collateral, and information as common elements that are present in all financial crises. Yet prior to the crash of 2007-2008, macroeconomics incorporated financial crises simply as bad shocks, like earthquakes, failing to consider them as an intrinsic phenomenon of the evolution of macroeconomic variables, such as credit, investment, and productivity.
Short-term debt is a critical element for storing value over short periods without