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The rate-of-return-dominance puzzle asks why low-return assets, like fiat money, are used in actual economies given that risk-free higher-return assets are available. As long as this question remains unresolved, most conclusions from monetary models which arbitrarily restrict the marketability...
Persistent link: https://www.econbiz.de/10009320820
This paper incorporates banks as well as frictions in the market for bank capital into a standard New Keynesian model and considers the positive and normative implications of various financial shocks. It shows that the frictions matter significantly for the effects of the shocks and the...
Persistent link: https://www.econbiz.de/10008503196
banking system. For that purpose, we consider an overlapping generation model with endogenous growth. There is horizontal … differentiation and imperfect competition in the banking sector. Macroeconomic shocks affect the return on capital and, together with … the expectations of depositors, condition the stability of the banking sector. We specify to what extent deposit insurance …
Persistent link: https://www.econbiz.de/10005036182
banking system. For that purpose, we consider an overlapping generation model with endogenous growth. …
Persistent link: https://www.econbiz.de/10005487051
In this paper, financial infrastructures increase the efficiency of the banking sector: they decrease the market power …
Persistent link: https://www.econbiz.de/10005487052