We build a model of the US economy with multiple aggregate shocks that generate
fluctuations in equilibrium house prices. Through counterfactual experiments, we study the …

What is the role of the financial sector in explaining business cycles? This question is as old
as the field of macroeconomics, and an extensive body of research conducted since the …

In this essay, we discuss the emerging literature in macroeconomics that combines
heterogeneous agent models, nominal rigidities, and aggregate shocks. This literature …

An increase in credit supply driven by looser lending constraints in the mortgage market is
the key force behind four empirical features of the housing boom before the Great …

This chapter reviews empirical estimates of differential income and consumption growth
across individuals during recessions. Most existing studies examine the variation in income …

To what extent did an expansion and contraction of credit drive the 2000s housing boom
and bust? The existing literature lacks consensus, with findings ranging from credit having …

We examine the consequences of a sudden increase in household debt burdens by
exploiting variation in exposure to household foreign currency debt during Hungary's late …

This paper shows that a macro model with segmented financial markets can generate
sizable movements in housing prices in response to changes in credit conditions. We …

We show that an estimated tractable 'buffer stock saving'model can match the 30-year
decline in the US saving rate leading up to 2007, the sharp increase during the Great …

Prompted by the recent US experience, in this chapter, we study the interaction between
cycles in credit markets and cycles in housing markets. There is a large growing literature …