We survey the empirical literature in economics on the impact of media technologies on social capital. Motivated by a simple model of information and collective action, we cover a range of different outcomes related to social capital, from social and political participation to interpersonal...

A growing body of evidence suggests that people exhibit large biases when processing information about themselves, but less is known about the underlying inference process. This paper studies belief updating patterns regarding academic ability in a large sample of students transitioning from...

Using a model with housing search, endogenous credit constraints, and mortgage default, this paper accounts for the housing crash from 2006 to 2011 and its implications for aggregate and cross-sectional consumption during the Great Recession. Left tail shocks to labor market uncertainty and...

We design a new, implementable capital requirement for large financial institutions (LFIs) that are too big to fail. Our mechanism mimics the operation of margin accounts. To ensure that LFIs do not default on either their deposits or their derivative contracts, we require that they maintain an...

The Financial Sector Reforms Commission (FSLRC) which was set up in 2011 by the Ministry of Finance was mandated to study existing legislation and financial sector regulatory practices in India and to propose improvements. The FSLRC submitted its report in 2013 and four of its members recorded...

A bank panic is an expectation-driven redemption event that results in a self-fulfilling prophecy of losses on demand deposits. From the standpoint of theory in the tradition of Diamond and Dybvig (1983) and Green and Lin (2003), it is surprisingly di¢ cult to generate bank panic equilibria if...

European Union countries offer a unique experience of financial regulatory and supervisory integration, complementing various other European integration efforts following the second world war. Financial regulatory and supervisory integration was a very slow process before 2008, despite...

The conventional paradigm about development banks is that these institutions exist to target well-identified market failures. However, market failures are not directly observable and can only be ascertained with a suitable learning process. Hence, the question is how do the policymakers know...

This paper investigates a model of strategic interactions in financial networks, where the decision by one agent on whether or not to default impacts the incentives of other agents to escape default. Agents' payoffs are determined by the clearing mechanism introduced in the seminal contribution...

How does monetary policy impact upon macroprudential regulation? This paper models monetary policy's transmission to bank risk taking, and its interaction with a regulator's optimization problem. The regulator uses its macroprudential tool, a leverage ratio, to maintain financial stability,...