Goodfriend, Marvin; Lacker, Jeffrey M. - Federal Reserve Bank of Richmond - 1999
Central bank or International Monetary Fund lending should be regarded as a line of credit, analogous to private line-of-credit … products. Contractual provisions in private line-of-credit arrangements are designed to control managerial moral hazard and … provide a means for profit-maximizing lenders to credibly commit to withdraw credit and induce closure when appropriate. The …