"Presents research from experts in academia and the financial industry on financial instruments and new financial institutions, contrasting developments in the United States and Japan. Highlights innovative ways in which Japanese financiers and government officials have learned from the United...

In moral hazard models, bank shareholders have incentives to transfer wealth from the deposit insurer - that is, maximize put option value - by pursuing riskier strategies. For safe banks with large charter value, however, the risk-taking incentive is outweighed by the possibility of losing...