Edwin le Heron

Confidence and financial crisis in a post-Keynesian stock flow consistent model

27 pages · 10.80 EUR
(September 2011)

I agree with the terms and conditions, especially point 10 (only private use, no transmission to third party)

Abstract:

The paper aims at showing that one of the main channels by which the US 2007 financial crisis became a real and global economic crisis is the 'confidence channel', i.e. that the financial crisis affected firms, banks and households? expectations and confidence, thus leading to what they were fearing. And I propose to model expectations and the state of confidence of private agents to use the indexes calculated by national statistical services from monthly polls.

JEL classifications: E12, E27, E41, E43, E47, E51, E52

Keywords: confidence, financial crisis, stock-flow-consistent modelling