Contents -- I. Introduction and Motivation -- II. The Model with Financial Intermediation and Frictions -- A. The Basic Structure of the Model -- B. Description of the Model's Micro Foundations -- C. Main Characteristics of Policy Transmission -- III. Model Calibration and Properties -- A. Parameterizing Steady State -- B. Parameterizing Transitory Dynamics and Stochastic Properties -- IV. Using the Model-Based Framework for Policy Analysis-Implications of a Credit Crunch -- A. Credit Crunch Induced by Exogenous Shocks -- B. Policy Induced Credit Crunch -- V. Conclusions and Policy Implications -- Reference -- Tables -- 1. List of Main Behavioral Parameters and Their Baseline Calibration -- 2. The Simulated Effects of the Exogenously Induced Credit Supply Shocks -- 3. The Simulated Effects of the Policy Shocks to Credit Supply: Priced-based Credit Measures -- 4. The Simulated Effects of the Individual Policy Shocks to Credit Supply: Credit Growth Controls -- Figures -- 1. Simulated Effects of the Exogenously Induced Credit Crunch Shock -- 2. Simulated Effects of the Price-Based Credit Measures -- 3. Simulated Effects of the Direct Credit Controls.