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While financial inclusion is typically addressed by improving the financial infrastructure, we show that a higher degree of financial literacy also has a clear beneficial effect. We study this effect at the cross-country level, which allows us to consider institutional variation. Regarding...
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paper shows that financial regulation can be effective at mitigating this type of risk. Exploiting regulatory changes … financial institutions subject to stricter regulation. Following the easing of these regulations, overconfidence-induced risk …-taking increases again. These findings confirm the effectiveness of financial regulation at correcting overconfident behavior, but also …
Persistent link: https://www.econbiz.de/10014477386
Several countries have recently introduced national capital standards exceeding the internationally coordinated Basel III rules, which is inconsistent with the 'race to the bottom' in capital standards found in the literature. We study regulatory competition when banks are heterogeneous and give...
Persistent link: https://www.econbiz.de/10011591503
This paper deals with both system-wide and banks' internal stress tests. For system-wide stress tests it describes the evolution over time, compares the stress test design in major jurisdictions, and discusses academic research. System-wide stress tests have gained in importance and nowadays...
Persistent link: https://www.econbiz.de/10012534563
potential endogeneity which are usually inherent to research into the real economic implications of bank regulation. We find a …
Persistent link: https://www.econbiz.de/10009751064
Multi-agency financial stability committees (FSCs) have grown dramatically since the global financial crisis. However, most cannot direct actions or recommend to other agencies that they take actions, and most would influence policy actions only through convening and discussing risks. We...
Persistent link: https://www.econbiz.de/10012170614
tightenings. Thus, our results indicate that post-crisis regulation is effective in reducing banks’ complexity-risk nexus. …
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