Generate Formal Borrowing Menu

back to Fan's Dynamic Assets Repository Table of Content.

Contents

function [ar_forbrblk, ar_forbrblk_r] = ffs_for_br_block_gen(varargin)

FFS_FOR_BR_BLOCK_GEN formal borrowing blocks

Grid of formal borrowing points with associated interest rates. Policies could shift this. This function could be invoked to generate multiple formal borrowing grids from multiple formal borrowing providers, and the overall formal borrowing choice set is a combination of these grids.

@param fl_r_fbr boolean single formal borrowing interest rate

@param st_forbrblk_type string different formal borrowing grid structures, some for testing/illustration purposes. Estimation uses real observed blocks from data.

@param st_forbrblk_type string different formal borrowing grid structures, some for testing/illustration purposes. Estimation uses real observed blocks from data.

@param fl_forbrblk_brmost float maximum formal borrowing allowed on grid, , might not not be relevant for all st_forbrblk_type

@param fl_forbrblk_brleast float minimum formal borrowing allowed on grid, might not be relevant for all st_forbrblk_type

@param fl_forbrblk_gap float formal borrowing grid gap, means different things for different st_forbrblk_type

@return ar_forbrblk array array of formal borrowing grid points. should be ordered from lowest to highest including zero at the top. i.e.: [-4, -2, -1, 0]. These are assumed to be in principles units always. PRINCIPLES only, do not include interest rates.

@return ar_forbrblk_r array interest rates associated with equal-length ar_forbrblk. ar_forbrblk_r multiplied element-wise with ar_forbrblk will provide the principle + interest rates associated with each formal borrowing grid elements.

@example

[ar_forbrblk, ar_forbrblk_r] = ...
     ffs_for_br_block_gen(fl_r_fbr, st_forbrblk_type, fl_forbrblk_brmost, fl_forbrblk_brleast, fl_forbrblk_gap);

@seealso

Default

fl_r_fbr = 0.045;
[st_forbrblk_type, fl_forbrblk_brmost, fl_forbrblk_brleast, fl_forbrblk_gap] = deal('seg3', -19, -1, -1.5);
bl_display_forbrblock = false;
default_params = {fl_r_fbr st_forbrblk_type fl_forbrblk_brmost fl_forbrblk_brleast fl_forbrblk_gap ...
    bl_display_forbrblock};

Parse Parameters

% numvarargs is the number of varagin inputted
[default_params{1:length(varargin)}] = varargin{:};
[fl_r_fbr, st_forbrblk_type, fl_forbrblk_brmost, fl_forbrblk_brleast, fl_forbrblk_gap, ...
    bl_display_forbrblock] = default_params{:};

Set Formal Borrowing Grid Uniform

if (strcmp(st_forbrblk_type, 'unif'))
    ar_forbrblk = fl_forbrblk_brleast:fl_forbrblk_gap:fl_forbrblk_brmost;
end

Set Formal Borrowing Grid Three Segment

An example grid with three segments, the first segement has fl_forbrblk_gap as gap, the second segment gap is twice, the third segement the gap is 3 times as large as fl_forbrblk_gap. Respect fl_forbrblk_brmost fl_forbrblk_brleast, which means divided into three parts based on them as much as possible

if (strcmp(st_forbrblk_type, 'seg3'))
    fl_most_least_gap = (fl_forbrblk_brmost - fl_forbrblk_brleast);
    fl_most_least_seg3_interval = fl_most_least_gap/3;

    ar_seg1 = fl_forbrblk_brleast:fl_forbrblk_gap:fl_most_least_seg3_interval;
    ar_seg2 = max(ar_seg1):(fl_forbrblk_gap*2):fl_most_least_seg3_interval*2;
    ar_seg3 = max(ar_seg2):(fl_forbrblk_gap*3):fl_forbrblk_brmost;

    ar_forbrblk =[ar_seg1, ar_seg2, ar_seg3];
end

Set Formal Borrowing Grid Three Segment

An example grid with three segments, the first segement has fl_forbrblk_gap as gap, the second segment gap is twice, the third segement the gap is 3 times as large as fl_forbrblk_gap. Respect fl_forbrblk_brmost fl_forbrblk_brleast, which means divided into three parts based on them as much as possible

if (strcmp(st_forbrblk_type, 'testfx'))
    fl_most_least_gap = (fl_forbrblk_brmost - fl_forbrblk_brleast);
    fl_most_least_seg3_interval = fl_most_least_gap/3;

    ar_seg1 = fl_forbrblk_brleast:fl_forbrblk_gap:fl_most_least_seg3_interval;
    ar_seg2 = max(ar_seg1):(fl_forbrblk_gap*2):fl_most_least_seg3_interval*2;
    ar_seg3 = max(ar_seg2):(fl_forbrblk_gap*3):fl_forbrblk_brmost;

    ar_forbrblk =[-3 -6];
end

Sort Borrowing Blocks

% add zero because formal borrowing = 0 should be an option
ar_forbrblk = [-0 ar_forbrblk];
ar_forbrblk = sort(unique([ar_forbrblk]));

Generate Corresponding Interest Rates Arrays

ar_forbrblk_r = fl_r_fbr + zeros(size(ar_forbrblk));

if (bl_display_forbrblock)
    disp('ar_forbrblk');
    disp(ar_forbrblk);
    disp('ar_forbrblk_r');
    disp(ar_forbrblk_r);
end

end

ans =

  Columns 1 through 7

  -19.0000  -14.5000  -10.0000   -7.0000   -5.5000   -4.0000   -2.5000

  Columns 8 through 9

   -1.0000         0

Published with MATLAB® R2019a