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Financing as a Supply Chain : The Capital Structure of Banks and Borrowers
Gornall, William - 2013
We develop a model of the joint capital structure decisions of banks and their borrowers. Strikingly high bank leverage emerges naturally from the interplay between two sets of forces. First, seniority and diversification reduce bank asset volatility by an order of magnitude relative to that of...
Persistent link: https://www.econbiz.de/10012459028
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Financiers vs. Engineers : Should the Financial Sector be Taxed or Subsidized?
Philippon, Thomas - 2007
I study the allocation of human capital in an economy with production externalities, financial constraints and career choices. Agents choose to become entrepreneurs, workers or financiers. Entrepreneurship has positive externalities, but innovators face borrowing constraints and require the...
Persistent link: https://www.econbiz.de/10012465087
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The Economic Consequences of Legal Origins
Porta, Rafael La - 2007
In the last decade, economists have produced a considerable body of research suggesting that the historical origin of a country's laws is highly correlated with a broad range of its legal rules and regulations, as well as with economic outcomes. We summarize this evidence and attempt a unified...
Persistent link: https://www.econbiz.de/10012465031
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After the Big Bang? Obstacles to the Emergence of the Rule of Law in Post-Communist Societies
Hoff, Karla - 2002
When Russia launched mass privatization, it was widely believed that it would create a powerful constituency for the rule of law. That didn't happen. We present a dynamic equilibrium model of the political demand for the rule of law and show that beneficiaries of mass privatization may fail to...
Persistent link: https://www.econbiz.de/10012469426
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Legal Origins
Glaeser, Edward L. - 2001
A central requirement in the design of a legal system is the protection of law enforcers from coercion by litigants through either violence or bribes. The higher the risk of coercion, the greater the need for protection and control of law enforcers by the state. This perspective explains why, in...
Persistent link: https://www.econbiz.de/10012470452
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Group Lending with Heterogeneous Types
Gan, Li - 2013
Group lending has been widely adopted in the past thirty years by many microfinance institutions as a means to mitigate information asymmetries when delivering credit to the poor. This paper proposes an empirical method to address the potential omitted variable problem resulting from unobserved...
Persistent link: https://www.econbiz.de/10012459814
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Fiscal Rules and Discretion under Self-Enforcement
Halac, Marina - 2017
We study a fiscal policy model in which the government is present-biased towards public spending. Society chooses a fiscal rule to trade off the benefit of committing the government to not overspend against the benefit of granting it flexibility to react to privately observed shocks to the value...
Persistent link: https://www.econbiz.de/10012453795
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Public Finance in a Nutshell : A Cobb Douglas Teaching Tool for General Equilibrium Tax Incidence and Excess Burden
Fullerton, Don - 2017
To help first- or second-year graduate students in economics apply their theoretical training, this paper shows how to solve a simple and intuitive computable general equilibrium (CGE) model using a calculator. Because this simplified Harberger model uses Cobb Douglas functional forms for...
Persistent link: https://www.econbiz.de/10012455616
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On Fiscal Illusion and Ricardian Equivalence in Local Public Finance
Banzhaf, H. Spencer - 2012
We re-evaluate two forms of fiscal illusion in local public finance: debt illusion and renter illusion. The Ricardian … Equivalence Theorem for local governments suggests the form of finance of a public program (tax or debt finance) has no effects on … hundreds of open space referenda in the U.S. using a variety of finance mechanisms, we find evidence that households do prefer …
Persistent link: https://www.econbiz.de/10012460619
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Institutions, Factor Prices and Taxation : Virtues of Strong States?
Acemoglu, Daron - 2010
Many of the most pernicious economic institutions and policies create entry barriers or manipulate factor prices to transfer resources from entrepreneurs and workers to groups that hold political power. These inefficiencies partly result from the fact that direct and efficient fiscal instruments...
Persistent link: https://www.econbiz.de/10012462959