A Model of Financial Market Liquidity Based on Intermediary Capital

We present a model of financial market liquidity provided by financially constrained intermediaries. We show that market liquidity increases with the level of intermediary capital. We also characterize conditions under which intermediaries play a stabilizing or destabilizing role in markets. Finally, we sketch a number of areas, including welfare and public policy, on which the model can shed light

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Year of publication:	2010
Authors:	Gromb, Denis
Other Persons:	Vayanos, Dimitri (contributor)
Publisher:	[2010]: [S.l.] : SSRN
Subject:	Theorie \| Theory \| Finanzintermediation \| Financial intermediation \| Liquidität \| Liquidity \| Kapital \| Capital \| Finanzmarkt \| Financial market

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Extent:	1 Online-Ressource (15 p)
Series:	INSEAD Working Paper ; No. 2010/22/FIN
Type of publication:	Book / Working Paper
Language:	English
Notes:	Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments March 31, 2010 erstellt
Other identifiers:	10.2139/ssrn.1582363 [DOI]
Classification:	G01 - Financial Crises ; G11 - Portfolio Choice ; G12 - Asset Pricing ; G15 - International Financial Markets ; G18 - Government Policy and Regulation
Source:	ECONIS - Online Catalogue of the ZBW

Persistent link: https://www.econbiz.de/10013145343