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

In this paper we review recent advances in financial economics in relation to the measurement of systemic risk. We …

We show that the impact of government bailouts (liquidity injections) on a representative bank's risk taking depends on … the level of systematic risk of its loans portfolio. In a model where bank's output follows a geometric Brownian motion … and the government guarantees bank's liabilities, we show first that more generous bailouts may or may not induce banks to …

-based measures of systemic bank shocks (SBS). These measures differ from “banking crisis” (BC) indicators employed in many empirical … studies, which are constructed using primarily information on government actions undertaken in response to bank distress … that BC indicators actually measure lagged policy responses to systemic bank shocks. We then re-examine the impact of …

market stress, but we also make a contribution to the wider political science and finance literatures on measurement by …