BanksDecideInterestRate#

class bamengine.events.credit_market.BanksDecideInterestRate[source]#

Bases: Event

Banks set interest rates as markup over base rate with random shock.

Banks apply a random markup to the baseline policy rate to set their lending rates. The markup introduces heterogeneity in bank rates and competition for low-rate lenders.

Algorithm

For each bank k:

Generate rate shock: \(\varepsilon_k \sim U(0, h_\phi)\)
Apply markup: \(r_k = \bar{r} \times (1 + \varepsilon_k)\)

Mathematical Notation

\[r_k = \bar{r} \times (1 + \varepsilon_k)\]

where:

\(r_k\): interest rate charged by bank k
\(\bar{r}\): baseline policy rate (Simulation parameter)
\(\varepsilon_k\): random shock \(\sim U(0, h_\phi)\)
\(h_\phi\): maximum interest rate shock parameter (config)

Examples

Execute this event:

>>> import bamengine as be
>>> sim = be.Simulation.init(n_banks=10, seed=42)
>>> event = sim.get_event("banks_decide_interest_rate")
>>> event.execute(sim)

Check interest rates:

>>> sim.lend.interest_rate.mean()
0.035

Verify rates are above base rate:

>>> (sim.lend.interest_rate >= sim.r_bar).all()
True

Find lowest-rate bank:

>>> import numpy as np
>>> cheapest_bank = np.argmin(sim.lend.interest_rate)
>>> sim.lend.interest_rate[cheapest_bank]
0.031

Notes

This event must execute after BanksDecideCreditSupply and before FirmsPrepareLoanApplications (firms sort banks by rate).

The baseline policy rate \(\bar{r}\) is a Simulation-level parameter accessed via sim.r_bar.

All banks charge rates \(\geq \bar{r}\) since shock \(\varepsilon \geq 0\).

See also

FirmsPrepareLoanApplications: Firms sort banks by interest rate
CreditMarketRound: Uses interest_rate for new loans
bamengine.events._internal.credit_market.banks_decide_interest_rate: Implementation

execute(sim)[source]#

Execute the event’s logic.

Mutates simulation state in-place. This method must be implemented by all Event subclasses.

Parameters:: sim (Simulation) – The simulation instance containing all state and configuration.
Returns:: All mutations are in-place.
Return type:: None

Examples

Implement execute in a custom event:

>>> from bamengine import event, ops
>>>
>>> @event
... class CustomPricingEvent:
...     def execute(self, sim):
...         prod = sim.get_role("Producer")
...         # Apply 10% markup to all prices
...         new_prices = ops.multiply(prod.price, 1.1)
...         ops.assign(prod.price, new_prices)

Access configuration and RNG:

>>> @event
... class StochasticEvent:
...     def execute(self, sim):
...         shock = sim.config.h_rho
...         random_values = sim.rng.uniform(0, shock, size=sim.n_firms)
...         # Use random_values in calculations

Notes

The execute method receives full Simulation access, including: - All roles: sim.get_role(“RoleName”) or sim.prod, sim.wrk, etc. - Configuration: sim.config - RNG: sim.rng - Economy state: sim.ec

__init__()#

name = 'banks_decide_interest_rate'#

BanksDecideInterestRate#

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