financial transactions tax is entirely neutral. Second, in a model with correlated investment risk and short-term financing of …

This paper provides a framework for modeling the risk-taking channel of monetary policy, the mechanism how financial …

We analyze the link between banking sector quality and sovereign risk in the whole European Union over 1999–2014. We … employ four different indicators of sovereign risk (including market- and opinion-based assessments), a rich set of … is associated with increased sovereign risk. The sector's depth provides mixed results. The stability (capital adequacy …

This paper analyzes the effect of the removal of government guarantees on bank risk taking. We exploit the removal of …

The paper models the interaction between risk taking in the financial sector and central bank policy for the case of … pure illiquidity risk. It is shown that, when bad states are highly unlikely, public provision of liquidity may improve the … allocation, even though it encourages more risk taking (less liquid investment) by private banks. In general, however, there is …

This paper analyzes the effect of the removal of government guarantees on bank risk taking. We exploit the removal of …

, 2008), this paper analyses the adequate policy response to endogenous systemic liquidity risk. We analyse the feedback …

liquidity risk and characterizes them. Both a solvency (leverage) and a liquidity ratio are required to control the …