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Moral and Social Constraints to Strategic Default on Mortgages

Guiso, Luigi; Sapienza, Paola; Zingales, Luigi - C.E.P.R. Discussion Papers - 2009

We use survey data to study American households’ propensity to default when the value of their mortgage exceeds the … value of their house even if they can afford to pay their mortgage (strategic default). We find that 26% of the existing … the house. Yet, 17% of households would default, even if they can afford to pay their mortgage, when the equity shortfall …

Persistent link: https://www.econbiz.de/10005039578

Why do governments default, and why don't they default more often?

Buiter, Willem H.; Rahbari, Ebrahim - C.E.P.R. Discussion Papers - 2013

of last resort for the sovereign. Not only do political economy factors drive sovereign insolvency, they also influence …

Persistent link: https://www.econbiz.de/10011084128

When Does Strategic Debt Service Matter?

Acharya, Viral V; Huang, Jing-Zhi; Subrahmanyam, Marti G.; … - C.E.P.R. Discussion Papers - 2002

Recent work has suggested that strategic underperformance of debt-service obligations by equity holders can resolve the gap between observed yield spreads and those generated by Merton-style models. We show that this is not quite correct. The value of the option to underperform on debt-service...

Persistent link: https://www.econbiz.de/10005136417

The Political Economy of Financial Fragility

Feijen, Erik; Perotti, Enrico C - C.E.P.R. Discussion Papers - 2005

While financial liberalization has in general favourable effects, reforms in countries with poor regulation is often followed by financial crises. We explain this variation as the outcome of lobbying interests capturing the reform process. Even after liberalization, market investors must rely on...

Persistent link: https://www.econbiz.de/10005666751

Courts and Banks: Effects of Judicial Enforcement on Credit Markets

Bianco, Magda; Jappelli, Tullio; Pagano, Marco - C.E.P.R. Discussion Papers - 2002

less widely available. International evidence also shows that the depth of mortgage markets is inversely related to the … costs of mortgage foreclosure and other proxies for judicial inefficiency. …

Persistent link: https://www.econbiz.de/10005123567

Information Sharing, Lending and Defaults: Cross-Country Evidence

Jappelli, Tullio; Pagano, Marco - C.E.P.R. Discussion Papers - 1999

Theory predicts that information sharing among lenders attenuates adverse selection and moral hazard, and can therefore increase lending and reduce default rates. To test these predictions, we construct a new international data set on private credit bureaus and public credit registers. We find...

Persistent link: https://www.econbiz.de/10005497918

Do Credit Markets Discipline Sovereign Borrowers? Evidence from US States

Bayoumi, Tamim; Goldstein, Morris; Woglom, Geoffrey - C.E.P.R. Discussion Papers - 1995

The degree to which credit markets discipline sovereign borrowers is investigated by estimating the supply curve for debt faced by US states. The results generally support an optimistic view of the market discipline hypothesis, with credit markets providing incentives for sovereign borrowers to...

Persistent link: https://www.econbiz.de/10005498146

Credit Standards and Segregation

Ouazad, Amine; Rancière, Romain - C.E.P.R. Discussion Papers - 2011

How do credit standards on the mortgage market affect neighbourhood choice and the resulting level of urban segregation …-2006 mortgage credit boom on the level of school segregation. Census tract racial composition is strongly correlated with the racial … composition of the 10 closest schools in the cross section. Matching a national data set of mortgage originations with annual …

Persistent link: https://www.econbiz.de/10008873328

The Phillips Curve in Ireland: 1935 - 2012

Gerlach, Stefan; Lydon, Raemonn; Stuart, Rebecca - C.E.P.R. Discussion Papers - 2014

We study the determination of Irish inflation between 1935 and 2012 using a Phillips curve approach. We find that a simple backward-looking Phillips Curve that incorporates import prices is stable over the sample period and passes a number of diagnostic tests. We also consider the importance of...

Persistent link: https://www.econbiz.de/10011083710

Money, Interest Rates and Prices in Ireland, 1933-2012

Gerlach, Stefan; Stuart, Rebecca - C.E.P.R. Discussion Papers - 2014

rates in Ireland from a variety of sources for the period 1933-2012. We discuss in detail how the data set is constructed …

Persistent link: https://www.econbiz.de/10011083948