Credit rationing and the use of collateral are widely observed in debt financing. To our view there is yet no appropriate theoretical explanation for these facts. In the standard debt financing models the occurrence of credit rationing can be explained based on suitable assumptions. But those...

Institutions that rely on joint liability to facilitate lending to the poor have a long historyand are now a common feature of many developing countries. Economists have proposedseveral theories of joint-liability lending that stress various aspects of its informational andenforcement advantages...

We study entrepreneurs’ start-up financing from banks and local financiers. An informalnetwork, whose membership cannot be observed by outsiders, conveys the good signals itgets about the hidden types of network entrepreneurs to local financiers, which are thenreflected in different loan...

Im vergangenen Jahrzehnt gingen beträchtliche Kapitalströme aus den entwickeltenVolkswirtschaften mit einem starken Kreditwachstum in den Ländern des westlichen Balkans,der Türkei und den GUS einher. Dennoch konnten fast alle Länder der Region – ungeachtetihrer unterschiedlichen...

The paper explores the determinants of up-front fees on sovereign bank loans.Remuneration of bank loans is typically channelled through the floating interestbenchmark, the interest spread, and a battery of fees. There is substantial evidence of thespread paying for long-run sovereign repayment...

Lack of transparency in securitization transactions significantly contributed to thesevere financial crisis of 2007–2009. To increase transparency we—based on arecent idea by Markowitz (2009)—propose an incentive compatible mechanismfor future securitization transactions: financial claims...

Among the policy responses to the global financial crisis, the international provision of US dollars via central bank swap lines stands out. This paper studies the build-up of stresses on banks' balance sheets that led to this coordinated policy response. Using the BIS international banking...

The rate of growth in bank loans to private households and firms in Germany hasdeclined substantially since early 2000 and currently stands at virtually zero. In thisarticle, we analyse whether cyclical factors (“demand-side driven”) or banks’ unwillingnessand/or inability to lend...

This paper investigates the returns and flows of German money marketfunds before and during the liquidity crisis of 2007/2008. The mainfindings of this paper are: In liquid times money market funds enhancedtheir returns by investing in less liquid papers. By doing so they outperformedother funds...

Individual financial systems can be understood as very specific configurations of certain keyelements. Often these configurations remain unchanged for decades. We hypothesize that thereis a specific relationship between key elements, namely that of complementarity. Thus,complementarity seems to...