This paper examines the relationship between bank performance and economic growth at the state level. We develop a regional credit view to explain how, due to information costs, regional banking conditions can influence local economic activity by affecting a region's ability to fund local...

A demonstration that violations of the absolute priority rule exacerbate credit rationing problems by reducing the payment lenders receive in default states.

President Pianalto described the turmoil in financial markets, as well as the Federal Reserve’s actions to address the situation.

The authors construct a model with private information in which consumers write dynamic contracts with financial intermediaries.

An argument that APR violations exacerbate credit rationing problems by reducing the payment lenders receive in default states.

The relatively infrequent nature of major credit distress events makes a historical approach particularly useful. Using a combination of historical narrative and econometric techniques, we identify major periods of credit distress from 1875 to 2007, examine the extent to which credit distress...