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We suggest a new mechanism—the liquidity insurance channel—based on the widespread reliance of high credit quality firms on bank credit lines for liquidity management. Our model matches the patterns of usage of loans and credit lines in the cross‐section of firms and defines the conditions under which shocks to bank health affect primarily low or high credit quality firms. Our framework can explain why credit line origination is more cyclical than loan origination. Overall, we uncover a novel interaction between bank health and economic activity through the provision of bank credit lines to high credit quality firms.

The aim of this paper is the design of a hybrid nonlinear observer for mobile vehicles. The main problem is that position and velocity measurements are provided with a very low frequency, and the time between two consecutive measurements could be not constant, but it could vary randomly within a certain interval of time. For this reason the proposed observer has been contextualized in the hybrid systems framework. The convergence analysis of the estimation error has been carried out, and the sensitivity analysis has been performed in order to evaluate the bound of the estimation error when the measurements are biased and/or noisy. Simulation and experimental results, carried out on a mobile vehicle, show the feasibility of the proposed observer and the good behaviors in terms of estimation error that can be achieved