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countries experiencing systemic banking crises on profitability, credit, and the performance of borrower firms. Crisis exposures … reduce bank returns and tighten credit conditions for borrowers, constraining investment and growth. The effects are larger …
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We show that international consumption risk sharing is significantly improved by capital flows, especially portfolio investment. Concomitantly, we show that poor institutions hamper risk sharing, but to an extent that decreases with openness. In particular, risk sharing is prevalent even among...
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