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Safe but fragile : information acquisition, sponsor support and shadow bank runs
König, Philipp Johann; Pothier, David - 2018
This paper proposes a theory of shadow bank runs in the presence of sponsor liquidity support. We show that liquidity lines designed to insulate shadow banks from market and funding liquidity risk can be destabilizing, as they provide them with incentives to acquire private information about...
Persistent link: https://www.econbiz.de/10011855308
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Complementarity and Financial Systems
Hackethal, A.; Tyrell, Marcel - 1999
Individual financial systems can be understood as very specific configurations of certain key elements. Often these configurations remain unchanged for decades. We hypothesize that there is a specific relationship between key elements, namely that of complementarity. Thus, complementarity seems...
Persistent link: https://www.econbiz.de/10010316267
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Robust Stochastic Games and Systemic Risk
Huang, Xuancheng - 2017
Interbank borrowing and lending may induce systemic risk into financial markets. A simple model of this is to assume that log-monetary reserves are coupled, and that banks can also borrow/lend from/to a central bank. When all banks optimize their cost of borrowing and lending, this leads to a...
Persistent link: https://www.econbiz.de/10012949299
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Self-Reporting Race in Small Business Loans : A Game-Theoretic Analysis of Evidence from PPP Loans in Durham, NC
García, Raffi E.; Darity, Jr., William A. - 2022
Using hand-collected race information of small business owners that concealed their race in Paycheck Protection Program applications, we find evidence that not disclosing race information in loan applications pays off significantly. Our results show that black-owned businesses that concealed...
Persistent link: https://www.econbiz.de/10013296549
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A Model of Microfinance with Adverse Selection, Loan Default, and Self-Financing
Batabyal, Amitrajeet A.; Beladi, Hamid - 2014
We analyze a market for microfinance in a region of a developing nation in which all projects are either of high or low quality. There is adverse selection because only borrowers know whether their project is of high or low quality but the microfinance institutions (MFIs) do not. The MFIs are...
Persistent link: https://www.econbiz.de/10014203528
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Can a bonus overcome moral hazard? : an experiment on voluntary payments, competition, and reputation in markets for expert services
Angelova, Vera; Regner, Tobias - 2016
factors could improve advice quality. Besides advisor competition and identifiability we add the possibility for clients to … identifiabilitiy (leading to several client-advisor interactions over the course of the game) or competition (allowing one advisor to …-telling under competition. …
Persistent link: https://www.econbiz.de/10011530053
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Can a bonus overcome moral hazard? : an experiment on voluntary payments, competition, and reputation in markets for expert services
Angelova, Vera; Regner, Tobias - 2017
factors could improve advice quality. Besides advisor competition and identifiability we add the possibility for clients to … (leading to several client-advisor interactions over the course of the game) or competition (allowing one advisor to have …
Persistent link: https://www.econbiz.de/10011697162
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Can a bonus overcome moral hazard? : experimental evidence from markets for expert services
Angelova, Vera; Regner, Tobias - 2018
factors could improve advice quality. Besides advisor competition and identifiability, we add the possibility for clients to … make a voluntary payment, a bonus, after observing advice quality. While the combination of competition and reputation …. Thus, our results suggest that a voluntary component can act as a substitute for either competition or reputation …
Persistent link: https://www.econbiz.de/10011881706
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Communication & competition
Goeree, Jacob K.; Zhang, Jingjing - 2012
robustness by introducing competition between agents. We find that communication and competition act as substitutes …: communication raises efficiency in the absence of competition but lowers efficiency with competition, and competition raises …
Persistent link: https://www.econbiz.de/10010316885
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Some recent developments in the theory of competition in markets with adverse selection
Hellwig, Martin - 1986
Persistent link: https://www.econbiz.de/10000719989