Giuli, Maria Elena De; Maggi, Mario Alessandro; Paris, … - In: Journal of Banking & Finance 33 (2009) 6, pp. 1058-1068
This paper analyzes how the deposit guarantee value affects the risk incentives in a mutual guarantee system. We liken the guarantee's value to that of a European-style contingent claims portfolio. The main feature emerging from our model is that a mutual guarantee system would give banks an...