Aptus, Elias; Britz, Volker; Gersbach, Hans - Center for Financial Studies - 2014
We examine the impact of so-called Crisis Contracts on bank managers' risktaking incentives and on the probability of … Crisis Contracts, the managers' and shareholders' interests are aligned, and managers take more than the socially optimal … level of risk. We investigate how the introduction of Crisis Contracts changes the equilibrium level of risk-taking and the …