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The Catastrophic Effects of Natural Disasters on Insurance Markets
Viscusi, W. Kip - 2012
Natural catastrophes often have catastrophic risks on insurance companies as well as on the insured. Using a very large dataset on homeowners%u2019 insurance coverage by state, by firm, and by year for the 1984 to 2004 period, this paper documents the positive effect on losses and loss ratios of...
Persistent link: https://www.econbiz.de/10012755507
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How the Subprime Crisis Went Global : Evidence from Bank Credit Default Swap Spreads
Eichengreen, Barry - 2010
How did the Subprime Crisis, a problem in a small corner of U.S. financial markets, affect the entire global banking system? To shed light on this question we use principal components analysis to identify common factors in the movement of banks' credit default swap spreads. We find that fortunes...
Persistent link: https://www.econbiz.de/10012757524
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Wall Street's First Corporate Governance Crisis : The Panic of 1826
Hilt, Eric - 2010
In July of 1826, several prominent Wall Street firms abruptly went bankrupt, amid scandalous revelations of fraudulent financial practices by their management. Although mostly forgotten today, these events represented a watershed in the early development of the corporation laws and investor...
Persistent link: https://www.econbiz.de/10012757536
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Bankruptcy : Past Puzzles, Recent Reforms, and the Mortgage Crisis
White, Michelle J. - 2010
This paper discusses four bankruptcy-related policy issues. First, what is the economic rationale for having a … bankruptcy procedure at all and what defines an economically efficient bankruptcy procedure? Second, why did the number of U ….S. bankruptcy filings increase so dramatically between 1980 and 2005? Third, a major bankruptcy reform went into effect in the U …
Persistent link: https://www.econbiz.de/10012758032
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Deciphering the Liquidity and Credit Crunch 2007-08
Brunnermeier, Markus K. - 2010
This paper summarizes and explains the main events of the liquidity and credit crunch in 2007-08. Starting with the trends leading up to the crisis, I explain how these events unfolded and how four different amplification mechanisms magnified losses in the mortgage market into large dislocations...
Persistent link: https://www.econbiz.de/10012758056
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Tracing the Woes : An Empirical Analysis of the Airline Industry
Berry, Steven - 2010
The U.S. airline industry went through tremendous turmoil in the early 2000's. There were four major bankruptcies and two major mergers, with all legacy carriers reporting a large profit reduction. This paper presents a structural model of the airline industry, and estimates the impact of demand...
Persistent link: https://www.econbiz.de/10012758133
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Internal Debt Crises and Sovereign Defaults
Arellano, Cristina - 2010
In this paper, we use data from developing countries to argue that sovereign defaults are often caused by fiscal pressures generated by large-scale domestic defaults. We argue that these systemic domestic defaults are caused by shocks best interpreted as being non-fundamental. We construct a...
Persistent link: https://www.econbiz.de/10012759536
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Accounting for the Rise in Consumer Bankruptcies
Livshits, Igor - 2010
market innovations which cause a decrease in the transactions cost of lending and a decline in the cost of bankruptcy can … largely accounting for the rise in consumer bankruptcy. We also argue that the abolition of usury laws and other legal changes …
Persistent link: https://www.econbiz.de/10012759871
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Costs of Financial Distress, Delayed Calls of Convertible Bonds, and the Role of Investment Banks
Shleifer, Andrei - 2010
In a frictionless market with perfect information, a shareholder-wealth- maximizing firm should force conversion of its convertible bond issue into stock as soon as the bond comes in-the-money. Firms however appear to systematically delay forced conversion, sometimes for years, beyond this time....
Persistent link: https://www.econbiz.de/10012760209
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Debt Enforcement Around the World
Djankov, Simeon - 2010
We present insolvency practitioners from 88 countries with an identical case of a hotel about to default on its debt, and ask them to describe in detail how debt enforcement against this hotel will proceed in their countries. We use the data on time, cost, and the likely disposition of the...
Persistent link: https://www.econbiz.de/10012760474