This paper documents and assesses the risk stemming from rising corporate indebtedness in China using a firm-level dataset of listed firms. It finds that while leverage on average is not high, there is a fat tail of highly leveraged firms accounting for a significant share of total corporate...

This paper examines the impact of the recent global crisis on emerging market economies (EMs). Our cross-country analysis shows that the impact of the crisis was more pronounced in those EMs that had initial weaker fundamentals and greater financial and trade linkages. This effect is observed...

In a crisis, when faced with insolvency, banks can sell stock in a dilutive offering in thestock market and borrow money in order to raise funds. We propose a simple model to find themaximum amount of new funds the banks can raise in these ways. To do this, we incorporatemarket confidence of the...