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Bank Quality, Judicial Efficiency and Borrower Runs : Loan Repayment Delays in Italy
Schiantarelli, Fabio - 2016
Exposure to liquidity risk makes banks vulnerable to runs from both depositors and from wholesale, short-term investors. This paper shows empirically that banks are also vulnerable to run-like behavior from borrowers who delay their loan repayments (default). Firms in Italy defaulted more...
Persistent link: https://www.econbiz.de/10012997894
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Leverage and Beliefs : Personal Experience and Risk Taking in Margin Lending
Koudijs, Peter - 2014
What determines risk-bearing capacity and the amount of leverage in financial markets? Using unique archival data on collateralized lending, we show that personal experience can affect individual risk-taking and aggregate leverage. When an investor syndicate speculating in Amsterdam in 1772 went...
Persistent link: https://www.econbiz.de/10013057407
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Generalized Moments Estimation for Panel Data
Druska, Viliam; Horrace, William C. - 2021
This paper considers estimation of a panel data model with disturbances that are autocorrelated across cross … estimate spatial dependence parameters. For the case where the time dimension is small (the usual panel data case), we develop … Kelejian and Prucha. We apply this approach in a stochastic frontier framework to a panel of Indonesian rice farms where …
Persistent link: https://www.econbiz.de/10013232767
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Foreclosure Externalities : Some New Evidence
Gerardi, Kristopher - 2014
In a recent set of influential papers, researchers have argued that residential mortgage foreclosures reduce the sale prices of nearby properties. We revisit this issue using a more robust identification strategy combined with new data that contain information on the location of properties...
Persistent link: https://www.econbiz.de/10013065502
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China's Financial System : Opportunities and Challenges
Allen, Franklin - 2012
We provide a comprehensive review of China's financial system, and explore directions of future development. First, the financial system has been dominated by a large banking sector. In recent years banks have made considerable progress in reducing the amount of non-performing loans and...
Persistent link: https://www.econbiz.de/10013110934
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Credit Smoothing
Hundtofte, Sean - 2019
Standard economic theory says that unsecured, high-interest, short-term debt — such as borrowing via credit cards and bank overdraft facilities — helps individuals smooth consumption in the event of transitory income shocks. This paper shows that — on average — individuals do not use...
Persistent link: https://www.econbiz.de/10012861728
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Loan Prospecting and the Loss of Soft Information
Agarwal, Sumit - 2014
We study a controlled experiment in which a bank's loan officers were incentivized based on originated loan volume to encourage prospecting for new business. While treated loan officers did attract new applications, both extensive and intensive margins of loan origination expanded (+31% new...
Persistent link: https://www.econbiz.de/10013057822
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Financial Dampening
Wieland, Johannes - 2016
We propose a novel mechanism, “financial dampening,” whereby loan retrenchment by banks attenuates the effectiveness of monetary policy. The theory unifies an endogenous supply of illiquid local loans and risk-sharing among subsidiaries of bank holding companies (BHCs). We derive an...
Persistent link: https://www.econbiz.de/10012995512
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Systemic Credit Freezes in Financial Lending Networks
Acemoglu, Daron; Ozdaglar, Asuman E.; Siderius, James; … - 2022
This paper develops a network model of interbank lending, in which banks decide to extend credit to their potential borrowers. Borrowers are subject to shocks that may force them to default on their loans. In contrast to much of the previous literature on financial networks, we focus on how...
Persistent link: https://www.econbiz.de/10013298205
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Do Banks Pass Through Credit Expansions to Consumers Who Want to Borrow?
Agarwal, Sumit - 2015
estimating heterogeneous MPBs and MPLs in the U.S. credit card market. Using panel data on 8.5 million credit cards and 743 …
Persistent link: https://www.econbiz.de/10013015102