In this paper we present and discuss a Macroeconomic Agent-Based Model with Capital and Credit (CC-MABM) which builds upon the framework put forward by Delli Gatti et al. (2011). The novelty of this model with respect to the previous framework consists in the introduction of a stylized supply chain where upstream firms – i.e. producers of capital goods (K-firms) – supply a durable and sticky input (capital) to the downstream firms, who produce consumption goods (C-firms) to be sold to households. Both C-firms and K-firms resort to bank loans to satisfy their financing needs. There are two-way feedbacks between firms and markets which yield interesting emerging properties at the macro level. We show that the interaction of upstream and downstream firms and the evolution of their financial conditions – in a nutshell: Capital and Credit – are essential ingredients of a “crisis” i.e. a sizable slump followed by a long recovery.

Emergent dynamics of a macroeconomic agent based model with capital and credit

Grazzini, Jakob
2015-01-01

Abstract

In this paper we present and discuss a Macroeconomic Agent-Based Model with Capital and Credit (CC-MABM) which builds upon the framework put forward by Delli Gatti et al. (2011). The novelty of this model with respect to the previous framework consists in the introduction of a stylized supply chain where upstream firms – i.e. producers of capital goods (K-firms) – supply a durable and sticky input (capital) to the downstream firms, who produce consumption goods (C-firms) to be sold to households. Both C-firms and K-firms resort to bank loans to satisfy their financing needs. There are two-way feedbacks between firms and markets which yield interesting emerging properties at the macro level. We show that the interaction of upstream and downstream firms and the evolution of their financial conditions – in a nutshell: Capital and Credit – are essential ingredients of a “crisis” i.e. a sizable slump followed by a long recovery.
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11571/1345922
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