We study how higher capital requirements introduced at the supranational level a↵ect the regulatory capital of banks across countries. Using the 2011 EBA capital exercise as a quasi-natural experiment, we find that treated banks exploit discretion in the calculation of regulatory capital to...

We study how supranational capital regulation incentivizes national authorities to exercise forbearance and how this affects the regulatory capital of banks across countries. Using the 2011 EBA capital exercise as a quasi-natural experiment, we find that banks substantially inflated their levels...

This paper uses U.S. panel data to estimate the effect of expected effective corporate tax rates on firm’s leverage. The paper directly estimates expected corporate tax rates using rational expectations. The estimated measures of the expected effective tax rates of firms are related to a...