Showing 1 - 9 of 9
Persistent link: https://www.econbiz.de/10012830010
Persistent link: https://www.econbiz.de/10001516268
Persistent link: https://www.econbiz.de/10010190982
This article presents a model in which, contrary to conventional wisdom, competi- tion can make banks more reluctant to take excessive risks: As competition intensifies and margins decline, banks face more-binding threats of failure, to which they may respond by reducing their risk-taking. Yet,...
Persistent link: https://www.econbiz.de/10010350799
Persistent link: https://www.econbiz.de/10011816228
This paper considers the competitive effects of funding and collaboration alliances between established corporations and entrepreneurial potential rivals. We develop a formal setting to explore how in the presence of mutual agency conflicts, (i) cost efficiencies from resource sharing, (ii) the...
Persistent link: https://www.econbiz.de/10014112511
Greater competition in banking is traditionally believed to aggravate banks' incentive to take excessive risks. This paper presents a model in which, contrary to the traditional view, an increase in competition can cause banks to behave more prudently: As competition intensifies and margins...
Persistent link: https://www.econbiz.de/10012973246
Less-intense competition for deposits, by mitigating banks' incentive to take excessive risks, is traditionally believed to lead to lower non-performing loan (NPL) ratios and more-stable banks. This paper revisits this proposition in a model with borrower moral hazard in which banks' NPL ratios...
Persistent link: https://www.econbiz.de/10012974120
In imperfectly competitive credit markets, banks can face a tradeoff between exploiting their market power and enforcing hard budget constraints. As market power rises, banks eventually find it too costly to discipline underperforming borrowers by stopping their projects. Lending relationships...
Persistent link: https://www.econbiz.de/10013096227