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Liquidity Risk, Liquidity Creation and Financial Fragility : A Theory of Banking
Diamond, Douglas W. - 1999
Both investors and borrowers are concerned about liquidity. Investors desire liquidity because they are uncertain about … when they will want to eliminate their holding of a financial asset. Borrowers are concerned about liquidity because they … compensation for the illiquidity investors will be subject to. We argue that banks can resolve these liquidity problems that arise …
Persistent link: https://www.econbiz.de/10012471328
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Bank Branch Density and Bank Runs
Benmelech, Efraim; Yang, Jun; Zator, Michal - National Bureau of Economic Research - 2023
Bank branch density, defined as the number of bank branches to total deposits, has significantly declined over the past decade, fueled by a confluence of branch closings and the almost doubling of deposits between 2016 and 2022. During this period, banks with low branch density benefited from...
Persistent link: https://www.econbiz.de/10014322849
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Let the Worst One Fail : A Credible Solution to the Too-Big-To-Fail Conundrum
Philippon, Thomas; Wang, Olivier - National Bureau of Economic Research - 2021
We study time-consistent bank resolution mechanisms. When interventions are ex post efficient, a government cannot commit not to inject capital into the banking system. Contrary to common wisdom, we show that the government may still avoid moral hazard and implement the first best allocation by...
Persistent link: https://www.econbiz.de/10012794588
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Bank Failures and Economic Activity : Evidence from the Progressive Era
Richardson, Gary; Angel, Marco del; Gou, Michael - National Bureau of Economic Research - 2024
During the Progressive Era (1900-29), economic growth was rapid but volatile. Boom and busts witnessed the formation and failure of tens of thousands of firms and thousands of banks. This essay uses new data and methods to identify causal links between failures of banks and bankruptcies of...
Persistent link: https://www.econbiz.de/10014528384
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How do Financial Crises Redistribute Risk?
Mitchener, Kris; Vossmeyer, Angela - National Bureau of Economic Research - 2023
We examine how financial crises redistribute risk, employing novel empirical methods and micro data from the largest financial crisis of the 20th century - the Great Depression. Using balance-sheet and systemic risk measures at the bank level, we build an econometric model with incidental...
Persistent link: https://www.econbiz.de/10014337771
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Restoring Confidence in Troubled Financial Institutions After a Financial Crisis
Calomiris, Charles W.; Carlson, Mark - National Bureau of Economic Research - 2022
After an unprecedented number of banks suspended operations during the Panic of 1893, the head regulator of banks chartered by the United States government allowed about 100 banks to reopen after certifying their solvency. We evaluate whether actions by bank owners to change management, contract...
Persistent link: https://www.econbiz.de/10013334444
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Loans for the "Little Fellow : " Credit, Crisis, and Recovery in the Great Depression
Quincy, Sarah - National Bureau of Economic Research - 2023
diversify away local liquidity shortfalls, allowing it to maintain 49 percent higher credit growth from 1929 to 1933 than …
Persistent link: https://www.econbiz.de/10014421204
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Bank Runs : Liquidity and Incentives
Cooper, Russell - 1991
Diamond-Dybvig [1983] provide a model of intermediation in which bank runs are driven by pessimistic depositor expectations. Models which address these issues are important in the ongoing discussion which weighs the costs (incentive problems) and the benefits (preventing runs) of deposit...
Persistent link: https://www.econbiz.de/10012475067
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How to Restructure Failed Banking Systems : Lessons from the U.S. in the 1930's and Japan in the 1990's
Calomiris, Charles - 2003
The costs of government assistance to banks depend on the way rescues are managed. The cnetral questions of policy reference do not revolve around whether to bail out banks, but rather around the choice of which banks to rescue and the means for doing so. If a rescue is handled skillfully, the...
Persistent link: https://www.econbiz.de/10012469074
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Can Emerging Market Bank Regulators Establish Credible Discipline? The Case of Argentina, 1992-1999
Calomiris, Charles W. - 2000
In the early 1990s, after decades of high inflation and financial repression, Argentina embarked on a course of macroeconomic and bank regulatory reform. Bank regulatory policy promoted privatization, financial liberalization, and free entry, limited safety net support, and established a novel...
Persistent link: https://www.econbiz.de/10012471046