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The funds concentration effect and discriminatory bailout
Erlenmaier, Ulrich; Gersbach, Hans - 2001
In the presence of macroeconomic shocks severe enough to threaten the liquidity or solvency of the banking system, the regulator can rely on the funds concentration effect to save long-term investment projects. Some banks are forced into bankruptcy with the result that other banks obtain more...
Persistent link: https://www.econbiz.de/10011400865
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Central bank policies and financial markets : lessons from the Euro crisis
Mody, Ashoka; Nedeljkovic, Milan - 2018 - This version: November 20, 2018
The European Central Bank (ECB) took many measures to combat the eurozone's rolling financial crisis. For providing desperately scarce dollars to eurozone banks, the ECB relied on the U.S. Federal Reserve. Using a novel econometric framework, we identify financial markets' response to the...
Persistent link: https://www.econbiz.de/10011942687
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Systemic risk in banking, fire sales, and macroeconomic disasters
Bougheas, Spiros P.; Harvey, David I.; Kirman, Alan P.; … - 2024
We develop a dynamic computational network model of the banking system where fire sales provide the amplification mechanism of financial shocks. Each period a finite number of banks offers a large, but finite, number of loans to households. Banks with excess liquidity also offer loans to other...
Persistent link: https://www.econbiz.de/10014490902
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Macroeconomic effects of unconventional monetary policy in the Euro area
Peersman, Gert - 2011 - This draft: July 2011
I find that the Eurosystem can stimulate the economy beyond the policy rate by increasing the size of its balance sheet or the monetary base, that is so-called quantitative easing. The transmission mechanism turns out to be different compared to traditional interest rate innovations: (i) whilst...
Persistent link: https://www.econbiz.de/10009303919
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Macroeconomic factors and micro-level bank risk
Buch, Claudia M.; Eickmeier, Sandra; Prieto, Esteban - 2010
The interplay between banks and the macroeconomy is of key importance for financial and economic stability. We analyze this link using a factor-augmented vector autoregressive model (FAVAR) which extends a standard VAR for the U.S. macroeconomy. The model includes GDP growth, inflation, the...
Persistent link: https://www.econbiz.de/10008697545
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The quantification of structural reforms : extending the framework to emerging market economies
Égert, Balázs - 2018
. More competition-friendly regulations, as measured by the OECDs' Product Market Regulation (PMR) indicator improve economic … businesses boost the capital stock and the employment rate. No robust link between labour market regulation and MFP and capital … deepening could be established. But looser labour market regulation is found to go hand in hand with higher employment rates …
Persistent link: https://www.econbiz.de/10011800715
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The euro crisis and economic growth : a novel counterfactual approach
Terzi, Alessio - 2019 - This Draft: 25 June 2019
Macroeconomic adjustment in the euro area periphery was more recessionary than pre-crisis imbalances would have warranted. To make this claim, this paper uses a Propensity Score Matching Model to produce counterfactuals for the Eurozone crisis countries (Greece, Portugal, Ireland, Cyprus, Spain)...
Persistent link: https://www.econbiz.de/10012033212
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Different no more : country spreads in advanced and emerging economies
Born, Benjamin; Müller, Gernot J.; Pfeifer, Johannes; … - 2020
Interest-rate spreads fluctuate widely across time and countries. We characterize their behavior using some 3,200 quarterly observations for 21 advanced and 17 emerging economies since the early 1990s. Before the financial crisis, spreads are 10 times more volatile in emerging economies than in...
Persistent link: https://www.econbiz.de/10012162762
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Network formation and heterogeneous risks
Cabrales, Antonio; Gottardi, Piero - 2024
We study a new model to study the effect of contract externalities that arise through shock transmission. We model a financial network where good firms enjoy direct and indirect benefits from linking with one another. Bad risks benefit from having a connection with a good firm, but they are a...
Persistent link: https://www.econbiz.de/10014534063
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The impact of containment measures and monetary and fiscal responses on US financial markets during the Covid-19 pandemic
Abakah, Emmanuel Joel Aikins; Caporale, Guglielmo Maria; … - 2021
This paper analyses the effects of containment measures and monetary and fiscal responses on US financial markets during the Covid-19 pandemic. More specifically, it applies fractional integration methods to analyse their impact on the daily S&P500, the US Treasury Bond Index (USTB), the S&P...
Persistent link: https://www.econbiz.de/10012584220