Aptus, Elias; Britz, Volker; Gersbach, Hans - 2014
We examine the impact of so-called "Crisis Contracts" on bank managers' risktaking incentives and on the probability of … banking crises. Under a Crisis Contract, managers are required to contribute a pre-specified share of their past earnings to … occurs and that leads to a form of collective liability for bank managers. We develop a game-theoretic model of a banking …