. A minimum equity capital requirement can rule out asset substitution but also compromise market discipline by making … bank debt too safe. The optimal capital regulation requires that a part of bank capital be unavailable to creditors upon … ; systemic risk ; bailout ; forbearance ; moral hazard ; capital requirements …

-optimal capital structure trades off these two costs. With uncertainty about aggregate risk, bank creditors learn from other banks … externality that is ignored in privately-optimal bank capital structures. Thus, under plausible conditions, banks choose excessive … leverage relative to the socially optimal level, providing a rationale for bank capital regulation. While a blanket regulatory …

hazards — insufficient loan monitoring and asset substitution — requires a novel two-tiered capital requirement, including a … “special capital account” that is unavailable to creditors upon failure …

hazards — insufficient loan monitoring and asset substitution — requires a novel two-tiered capital requirement, including a … “special capital account” that is unavailable to creditors upon failure …

We build an equilibrium model of commodity markets in which speculators are capital constrained, and commodity … producers have hedging demands for commodity futures. Increases in producers' hedging demand or speculators' capital constraints …

financial crisis of 2007-09, they raised substantial amounts of new capital, both from private investors and through government …-funded capital injections. However, on closer inspection the composition of bank capital shifted radically from one based on common … banks to lend over this period. We draw conclusions on how capital regulation may be reformed in light of our findings. …