risk hazard regressions on the outcomes of the loans. The authors show that when the expected unemployment risk of … dynamic adverse selection that can worsen the risk characteristics of new lending, and suggests another avenue by which the …

to the model despite the significant nonlinearities that are absent in the economy with uninsurable labor income risk …. The model is capable of generating the average private equity premium of roughly 3 percent and a low risk-free rate. The … model also produces procyclicality of the risk-free rate and countercyclicality of the average private equity premium. The …

scale economies using two production models. The standard risk-neutral model finds little evidence of scale economies. The … model using more general risk preferences and endogenous risk-taking finds large scale economies. The authors show that …

products and services to informationally opaque customers, their ability to diversify credit and liquidity risk, and how they … liabilities to reduce the probability of bank runs. These aspects of banking affect a bank’s choice of risk vs. expected return …, which, in turn, affects bank performance. Banks have an incentive to reduce risk to protect the valuable charter from …

We develop a model of banking industry dynamics to study the quantitative impact of capital requirements on bank risk …

The Great Recession focused attention on large financial institutions and systemic risk. We investigate whether large … economies or too-big-to-fail subsidies. Estimating scale economies is made more complex by risk-taking. Better diversification … resulting from larger scale generates scale economies but also incentives to take more risk. When this additional risk …

business creation in a world where new business owners are exposed to idiosyncratic risk due to initial imperfect … diversification. This paper uses this framework to analyze how entrepreneurial risk has changed over time and how this has affected … employment in the US. Conditions are provided under which entrepreneurial risk can be identified using micro data on the size …

their perceived risk. We develop a dynamic stochastic general equilibrium model with the aim of verifying how sensible this …

This paper explores whether there was an economically significant differential in market-based risk between bank … participated in investment banking exhibited significantly lower total and unsystematic risk, suggesting that banks’ participation … systematic risk. …