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Managing Bank Liquidity Risk : How Deposit-Loan Synergies Vary with Market Conditions
Gatev, Evan - 2006
Liquidity risk in banking has been attributed to transactions deposits and their potential to spark runs or panics. We show instead that transactions deposits help banks hedge liquidity risk from unused loan commitments. Bank stock-return volatility increases with unused commitments, but the...
Persistent link: https://www.econbiz.de/10012466434
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Banks' Advantage in Hedging Liquidity Risk : Theory and Evidence from the Commercial Paper Market
Gatev, Evan - 2003
This paper argues that banks have a unique ability to hedge against market-wide liquidity shocks. Deposit inflows provide funding for loan demand shocks that follow declines in market liquidity. Consequently, one dimension of bank specialness' is that banks can insure firms against systematic...
Persistent link: https://www.econbiz.de/10012468741
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Optimal Risk Management Using Options
Ahn, Dong-Hyun - 1997
moneyness of the option as a function of the asset's distribution, the risk-free rate, and the VaR hedging period. We find that … the optimal strike of the put is independent of the level of expense the institution is willing to incur for its hedging … hedging cost or the increased cost to achieve a given VaR, are economically significant. Comparative static results show that …
Persistent link: https://www.econbiz.de/10012472656
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Execution Risk
Engle, Robert - 2006
Transaction costs in trading involve both risk and return. The return is associated with the cost of immediate execution and the risk is a result of price movements during a more gradual trading. The paper shows that the trade-off between risk and return in optimal execution should reflect the...
Persistent link: https://www.econbiz.de/10012466529
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The Structure and Conduct of Corporate Lobbying : How Firms Lobby the Federal Communications Commission
de Figueiredo, John M. - 2000
lobbying (internal organization vs. trade association) by firms in administrative agencies. It explores the power and limitations of the collective action theories and transaction cost theories in explaining lobbying. It introduces a dataset of over 900 lobbying contacts cover 101 issues at the...
Persistent link: https://www.econbiz.de/10012471024
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Discriminating Among Alternative Theories of the Multinational Enterprise
Markusen, James R. - 1999
trade. One simple taxonomy separates the theory into vertical' models in which firms geographically separate activities by …
Persistent link: https://www.econbiz.de/10012471623
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Frictions in Product Markets
Gavazza, Alessandro; Lizzeri, Alessandro - National Bureau of Economic Research - 2021
This is an invited chapter for the forthcoming Volume 4 of the Handbook of Industrial Organization. We focus on markets with frictions, such as transaction costs, asymmetric information, search and matching frictions. We discuss how such frictions affect allocations, favor the emergence of...
Persistent link: https://www.econbiz.de/10012629479
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Moving and Housing Expenditure : Transaction Costs and Disequilibrium
Venti, Steven F. - 1982
The paper emphasizes initially the effects of moving transaction costs on the potential effect of government rent subsidy programs. As a concomitant to this analysis, the paper reaffirms the low income elasticities of housing expenditure among low-income renters found by others. Moving...
Persistent link: https://www.econbiz.de/10012478093
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A Monetary Equilibrium Model with Transactions Costs
Rotemberg, Julio J. - 1982
This paper presents the competitive equilibrium of an economy in which people hold money for transactions purposes. It studies both the steady states which result from different rates of monetary expansion and the effects of such non-steady state events as an open market operation. Even though...
Persistent link: https://www.econbiz.de/10012478127
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The ICO Paradox : Transactions Costs, Token Velocity, and Token Value
Holden, Richard - 2019
Blockchain technology offers firms a novel method of raising capital, via so-called Initial Coin Offerings (ICOs). In the most novel form of an ICO, a firm creates digital assets called "utility tokens" that are tracked on a blockchain-based ledger; requires that its product be purchased only...
Persistent link: https://www.econbiz.de/10012480209