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Optimal Prudential Regulation of Banks and the Political Economy of Supervision

Tressel, Thierry; Verdier, Thierry - C.E.P.R. Discussion Papers - 2014

We consider a moral hazard economy with the potential for collusion between bankers and borrowers to study how incentives for risk taking are affected by the quality of supervision. We show that low interest rates or a low return on investment may generate excessive risk taking. Because of a...

Persistent link: https://www.econbiz.de/10011084111

The Macroeconomics of Modigliani-Miller

Gersbach, Hans; Haller, Hans; Müller, Jürg - C.E.P.R. Discussion Papers - 2013

We examine the validity of a macroeconomic version of the Modigliani-Miller theorem. For this purpose, we develop a general equilibrium model with two production sectors, risk-averse households and financial intermediation by banks. Banks are funded by deposits and (outside) equity and monitor...

Persistent link: https://www.econbiz.de/10011084423

When Everyone Runs for the Exit

Pedersen, Lasse Heje - C.E.P.R. Discussion Papers - 2009

The dangers of shouting ``fire'' in a crowded theater are well understood, but the dangers of rushing to the exit in the financial markets are more complex. Yet, the two events share several features, and I analyze why people crowd into theaters and trades, why they run, what determines the...

Persistent link: https://www.econbiz.de/10005082543

Optimal Interventions in Markets with Adverse Selection

Philippon, Thomas; Skreta, Vasiliki - C.E.P.R. Discussion Papers - 2010

We study interventions to restore efficient lending and investment when financial markets fail because of adverse selection. We solve a design problem where the decision to participate in a program offered by the government can be a signal for private information. We charac terize optimal...

Persistent link: https://www.econbiz.de/10008468692

Firm Default and Aggregate Fluctuations

Jacobson, Tor; Kindell, Rikard; Lindé, Jesper; … - C.E.P.R. Discussion Papers - 2008

This paper studies the relation between macroeconomic fluctuations and corporate defaults while conditioning on industry affiliation and an extensive set of firm-specific factors. Using a multiperiod logit approach on a panel data set for all incorporated Swedish businesses over 1990-2002, we...

Persistent link: https://www.econbiz.de/10005504257

Credit Rationing and Crowding-Out During the Industrial Revolution: Evidence from Hoare's Bank, 1702-1862

Temin, Peter; Voth, Hans-Joachim - C.E.P.R. Discussion Papers - 2004

-out hypothesis. Using a unique set of observations on lending volume at a London goldsmith bank, Hoare’s, we document the impact of …

Persistent link: https://www.econbiz.de/10005504267

Finance and Efficiency: Do Bank Branching Regulations Matter?

Acharya, Viral V; Imbs, Jean; Sturgess, Jason - C.E.P.R. Discussion Papers - 2007

We use portfolio theory to quantify the efficiency of state-level sectoral patterns of production in the United States … (particularly) interstate liberalization of bank branching restrictions. This effect arises primarily from convergence in the …

Persistent link: https://www.econbiz.de/10005504526

Financial Integration and Systemic Risk

Fecht, Falko; Grüner, Hans Peter - C.E.P.R. Discussion Papers - 2005

Recent empirical studies criticize the sluggish financial integration in the euro area and find that only interbank money markets are fully integrated so far. This paper studies the optimal regional and/or sectoral integration of financial systems given that integration is restricted to the...

Persistent link: https://www.econbiz.de/10005497717

Money Market Pressure and the Determinants of Banking Crises

Ho, Tai-Kuang; von Hagen, Jürgen - C.E.P.R. Discussion Papers - 2004

either direct and reliable indicators of banks’ assets quality are not available, or that withdrawals of bank deposits are no … the index, changes in central bank funds to bank deposits ratio and changes in short-term real interest rate, are equally … important in the identification of banking crises. Bank deposits, combined with central bank funds, provide valuable information …

Persistent link: https://www.econbiz.de/10005497741

Banking and Development

Sussman, Oren; Zeira, Joseph - C.E.P.R. Discussion Papers - 1995

This paper reformulates the well known financial development conjecture (FDC) and supplies some new empirical evidence in its favour. The financial development conjecture, namely, that there exist strong feedback effects between real and financial development, is described in this paper by use...

Persistent link: https://www.econbiz.de/10005498084