to "cream-skim," meaning to transfer risk to naive, uninformed, or unconcerned investors through the sale or …. They find that the likelihood of sale increases with risk along dimensions observable to banks but not likely observed or …

to insure counterparty risk by clearing those contracts through a CCP that uses novation and mutualization. As netting is … inefficient allocation of default risk relative to the gains from customization, a transfer scheme is needed. A CCP can implement …

authors examine whether insurance against college-failure risk can be offered, taking into account moral hazard and adverse … failure risk. The authors find that optimal insurance raises the enrollment rate by 3.5 percent, the fraction acquiring a …

This paper examines risk-adjusted performance measures in banking, which are used as a guide for efficient asset …. Traditional measures of performance are contrasted with the portfolio-based risk-adjusted measures using a unique detailed micro …

using a traditional and a novel approach, and offers valuable lessons learned when interpreting these risk measures. Among … interest rate risk is not the only risk that needs to be considered when conducting risk management with CMOs. …

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 …

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 …