Similar Search Results

Imperfect Bank Competition, Borrower Adverse Selection, and the Transmission of Monetary Policy

Cantillo, Miguel - 2023

This paper studies bank competition with borrower adverse selection. In the model, expected non-performing loan costs … are high when credit is granted in booms, when risk free rates are low, or when competition is strong. I prove that full … competition is suboptimal due to this last effect; that more competition improves the transmission of monetary policy, and that …

Persistent link: https://www.econbiz.de/10014355959

A detrimental feedback loop : deleveraging and adverse selection

Bertsch, Christoph - 2013

Market distress can be the catalyst of a deleveraging wave, as in the 2007/08 financial crisis. This paper demonstrates how market distress and deleveraging can fuel each other in the presence of adverse selection problems in asset markets. At the core of the detrimental feedback loop is agents'...

Persistent link: https://www.econbiz.de/10010202960

Bankers' Versus Workers' Europe (I) : Asymmetric Information in Emu

Bottazzi, Laura; Manasse, Paolo - 1998

The delegation of monetary policy to a supranational central bank creates a conflict of interest between residents of different countries. For example, the country in recession may favor more inflation to boost output, while the country in boom prefers exactly the opposite. This conflict gives...

Persistent link: https://www.econbiz.de/10014050611