Collateral, default penalties and almost finite-time solvency

We argue that it is possible to adapt the approach of imposing restrictions on available plans through finitely effective debt constraints, introduced by Levine and Zame (1996), to encompass models with default and collateral. Along this line, we introduce in the setting of Araujo, Páscoa and Torres-Martínez (2002) and Páscoa and Seghir (2008) the concept of almost finite-time solvency. We show that the conditions imposed in these two papers to rule out Ponzi schemes implicitly restrict actions to be almost finite-time solvent. We define the notion of equilibrium with almost finite-time solvency and look on sufficient conditions for its existence. Assuming a mild assumption on default penalties, namely that agents are myopic with respect to default penalties, we prove that existence is guaranteed (and Ponzi schemes are ruled out) when actions are restricted to be almost finite-time solvent. The proof is very simple and intuitive. In particular, the main existence results in Araujo et al. (2002) and Páscoa and Seghir (2008) are simple corollaries of our existence result.

The indetermination of senior (or the indetermination of Wagner) and Schmoller as a Social Economist

The propositions of pure economics, whatever be their generality and their truth, do not authorize normative concluaions, but cannot be ignored. The latter, namely what ought not to be done, is derivable from socio-economics. The derivation is to be qualified by the specificities of the case. I have called this the Indetermination of Senior; Wagner and Marshall were quite aware of it. The habit of ignoring it is the Ricardian Vice; Schmoller's fight may have been a reaction against the latter. The Methodenstreit was the first great paradigmatic conflict between pure and social economists.

R10 tem queda de popularidade, mas segue no topo, à frente de Guerrero

O mês de agosto foi mais modesto dentro de campo para Ronaldinho Gaúcho e Paolo Guerrero, o que resultou em uma queda de popularidade de ambos no Twitter. Apesar disso, sabem imbatíveis como personagens mais citados do Campeonato Brasileiro. O camisa 10 do Fluminense manteve a primeira colocação com 214.670 mil menções (teve 450.900 mil em julho). O centroavante rubro-negro é o segundo, agora com 176.108 mil (em julho teve 406.825 mil).