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Strategic complementarity, fragility, and regulation

Vives, Xavier - 2011 - Rev. May 2011

The paper analyzes a very stylized model of crises and demonstrates how the degree of strategic complementarity in the actions of investors is a critical determinant of fragility. It is shown how the balance sheet composition of a financial intermediary, parameters of the information structure...

Persistent link: https://www.econbiz.de/10009230899

Insurers monitor shocks to collateral : micro evidence from mortgage-backed securities

Fetzer, Thiemo; Guin, Benjamin; Netto, Felipe; Saidi, Farzad - 2024

This paper uncovers if and how insurance companies react to shocks to collateral in their portfolio of securitized assets. We address this question in the context of commercial real estate cash flow shocks, which are informationally opaque to holders of commercial mortgage-backed securities...

Persistent link: https://www.econbiz.de/10015061135

Finance and income inequality : a review and new evidence

Haan, Jakob de; Sturm, Jan-Egbert - 2016

Using a panel fixed effects model for a sample of 121 countries covering 1975-2005, we examine how financial development, financial liberalization and banking crises are related to income inequality. In contrast with most previous work, our results suggest that all finance variables increase...

Persistent link: https://www.econbiz.de/10011536253

Political booms, financial crises

Herrera, Helios; Ordoñez, Guillermo; Trebesch, Christoph - 2014

We show that political booms, measured by the rise in governments' popularity, predict financial crises above and beyond other better-known early warning indicators, such as credit booms. This predictive power, however, only holds in emerging economies. We show that governments in emerging...

Persistent link: https://www.econbiz.de/10010391815

The effects of systemic banking crises in the inter-war period

Rocha, Bruno T. da; Solomou, Solomos - 2015

This paper examines the time-profile of the impact of systemic banking crises on GDP and industrial production using a panel of 24 countries over the inter-war period and compares this to the post-war experience of these countries. We show that banking crises have effects that induce medium-term...

Persistent link: https://www.econbiz.de/10010496916

Shareholder liability and bank failure

Aldunate, Felipe; Jenter, Dirk; Korteweg, Arthur; … - 2021

Does enhanced shareholder liability reduce bank failure? We compare the performance of around 4,200 state-regulated banks of similar size in neighboring U.S. states with different liability regimes during the Great Depression. The distress rate of limited liability banks was 29% higher than that...

Persistent link: https://www.econbiz.de/10012584232

Investment in productivity and the long-run effect of financial crises in output

Ridder, Maarten de - 2016

This paper analyzes the channels through which financial crises exert long-term negative effects on output. Recent models suggest that a shortfall in productivity-enhancing investments temporarily slows technological progress, creating a gap between pre-crisis trend and actual GDP. This...

Persistent link: https://www.econbiz.de/10011573282

Stigma or cushion? : IMF programs and sovereign creditworthiness

Gehring, Kai; Lang, Valentin - 2018

IMF programs are often considered to carry a "stigma" that triggers adverse market reactions. We show that such a negative IMF effect disappears when accounting for endogenous selection into programs. To proxy for a country's access to financial markets, we use credit ratings and investor...

Persistent link: https://www.econbiz.de/10011931328

Financial policymaking after crises : public vs. private interests

Saka, Orkun; Ji, Yuemei; De Grauwe, Paul - 2021

We first present a simple model of post-crisis policymaking driven by both public and private interests. Using a novel dataset covering 94 countries between 1973 and 2015, we then establish that financial crises can lead to government interventions in financial markets. Consistent with a public...

Persistent link: https://www.econbiz.de/10012542146

Securitization of mortgage debt, asset prices and international risk sharing

Hoffmann, Mathias; Nitschka, Thomas - 2009

We explore the impact of mortgage securitization on the international diversification of macroeconomic risk. By making … mortgage-related risks internationally tradeable, securitization contributes considerably to better international consumption … countries that do not allow for mortgage securitization. Our results are based on quarterly data from a panel of 16 …

Persistent link: https://www.econbiz.de/10003806732

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