We study the eligibility of corporate bonds as collateral for central bank operations and its effect on interbank and corporate bond markets. While money market functionality increases in the amount of eligible assets, a thorough assessment of collateral policies must also account for endogenous...

Do information frictions have a causal impact on the international flow of financial capital? Using the international rollout of telegraph cables in the 19th century, I show causal evidence that reductions in information frictions had a significant and positive impact on the bilateral...