will be overstated, and the bias can be large (about 25 percent). Second, we argue that, according to finance theory, the …

measurement for financial firms, such as: (1) What are the correct "reference rates" to use in calculating bank output? In …

, much of bank output has to be estimated indirectly. In contrast to current statistical practice, dynamic optimizing models … of banks argue that compensation for bearing systematic risk is not part of bank output. We apply these models and find … that between 1997 and 2007, in the U.S. National Accounts, on average, bank output is overestimated by 21 percent and GDP …

bank debt holders. The current crisis raises issues for crisis theory. And, empirically, studying crises is challenging …Economic growth involves metamorphosis of the financial system. Forms of banks and bank money change. These changes, if … of crises. All financial crises are at root bank runs, because bank debt--of all forms--is vulnerable to sudden exit by …