Endogenous Credit, Business Cycle, and Portfolio Selection
研究了经济衰退期间富人和穷人投资行为的差异，通过一般均衡模型内生决定借贷约束，解释了富人增加风险投资而穷人减少的现象。
News story for “Endogenous Credit, Limited Commitment, Business Cycle” Countercyclical Investment Patterns with Endogenously Determined Credit Anticipated returns are sufficiently high to offset the elevated risks during downturns, presenting favorable investment opportunities. For instance, Warren Buffett accumulated more than $10 billion in profits amidst the 2008 financial crisis, as highlighted in his Wall Street Journal interview from October 2013: “In terms of simple profitability, an average investor could have performed just as well investing in the stock market if they bought during the panic period.” In “Endogenous Credit, Limited Commitment, Business Cycle,” Choi, Koo, Lim, and Yoo reveal a divergence in investment behavior between affluent and less affluent individuals during economic downturns. Whereas wealthier individuals tend to increase their exposure to risky investments, less affluent individuals tend to reduce theirs. We employ rigorous modeling and solution analysis to establish endogenous borrowing constraints in general equilibrium, elucidating the observed investment patterns.