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Caballero, Ricardo J. - 2004

Most economists and observers place the lack of fiscal discipline at the core of the recent Argentine crisis. This begs the question of how countries like Belgium or Italy (pre-Maastricht) could run large fiscal deficits and accumulate debts far beyond those of Argentina, without experiencing...

Persistent link: https://www.econbiz.de/10012468161

International Liquidity Management : Sterilization Policy in Illiquid Financial Markets

Caballero, Ricardo J. - 2000

the international liquidity management aspect of sterilization over the traditional monetary one, a re-focus that seems … liquidity management issues more generally …

Persistent link: https://www.econbiz.de/10012471010

Liquidity Dependence and the Waxing and Waning of Central Bank Balance Sheets

Acharya, Viral V.; Chauhan, Rahul S.; Rajan, Raghuram Govind - National Bureau of Economic Research - 2023

in 2017, there was no commensurate shrinkage of these claims on liquidity. Consequently, the financial sector was left … more sensitive to potential liquidity shocks, with weaker-capitalized banks most exposed. This necessitated Fed liquidity … provision in September 2019 and again in March 2020. Liquidity-risk-exposed banks suffered the most drawdowns and the largest …

Persistent link: https://www.econbiz.de/10014247971

Contingent Credit Under Stress

Acharya, Viral V.; Jager, Maximilian; Steffen, Sascha - National Bureau of Economic Research - 2023

' provision of liquidity insurance in the form of credit lines, their significance in managing corporate liquidity, and the …

Persistent link: https://www.econbiz.de/10014437040

Flight to Quality and Collective Risk Management

Caballero, Ricardo J. - 2006

We present a model of flight to quality episodes that emphasizes systemic risk and the Knightian uncertainty surrounding these episodes. Agents make risk management decisions with incomplete knowledge. They understand their own shocks, but are uncertain of how correlated their shocks are with...

Persistent link: https://www.econbiz.de/10012466519

The Internal Governance of Firms

Acharya, Viral V. - 2009

We develop a model of internal governance where the self-serving actions of top management are limited by the potential reaction of subordinates. Internal governance can mitigate agency problems and ensure that firms have substantial value, even with little or no external governance by...

Persistent link: https://www.econbiz.de/10012463081

Equilibrium Asset Prices Under Imperfect Corporate Control

Dow, James - 2003

Shareholders have imperfect ontrol over the decisions of the management of a firm. We integrate a widely accepted version of the separation of ownership and control -- Jensen's (1986) free cash flow theory--into a dynamic equilibrium model and study the effect of imperfect corporate control on...

Persistent link: https://www.econbiz.de/10012468940

Zombie Lending : Theoretical, International and Historical Perspectives

Acharya, Viral V.; Crosignani, Matteo; Eisert, Tim; … - National Bureau of Economic Research - 2022

This paper surveys the theory on zombie lending incentives and the consequences of zombie lending for the real economy. It also offers a historical perspective by reviewing the growing empirical evidence on zombie lending along three dimensions: (i) the role of under-capitalized banks, (ii)...

Persistent link: https://www.econbiz.de/10013190998

Liquidity Risk of Corporate Bond Returns : A Conditional Approach

Acharya, Viral V. - 2010

We study the exposure of the US corporate bond returns to liquidity shocks of stocks and Treasury bonds over the period … 1973 - 2007 in a regime - switching model. In one regime, liquidity shocks have mostly insignificant effects on bond prices … default), suggest the existence of time-varying liquidity risk of corporate bond returns conditional on episodes of flight to …

Persistent link: https://www.econbiz.de/10012462262

Rollover Risk and Market Freezes

Acharya, Viral V. - 2010

The crisis of 2007-09 has been characterized by a sudden freeze in the market for short-term, secured borrowing. We present a model that can explain a sudden collapse in the amount that can be borrowed against finitely-lived assets with little credit risk. The borrowing in this model takes the...

Persistent link: https://www.econbiz.de/10012462978