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Survival of the Biggest : Large Banks and Crises since 1870

Baron, Matthew; Schularick, Moritz; Zimmermann, Kaspar - 2022

This paper studies a newly compiled data set of annual balance sheets of more than 11,000 commercial banks across 17 advanced economies since 1870. The new data expose the central role of large banks for credit cycles and financial instability throughout modern financial history and the...

Persistent link: https://www.econbiz.de/10013492660

Fundamental, Regressive, and Structural Financialization before and after the Great Recession

Akan, Taner; Gündüz, Halil İbrahim - 2021

The paper investigates three major debates on contemporary economies: (i) if the major components of real economic activity (RECs) stimulate financial development (FND) but not vice versa, (ii) if RECs and FND jointly suppress labor, and (iii) if these two dynamics have incurred any substantial...

Persistent link: https://www.econbiz.de/10013311735

Collective Moral Hazard and the Interbank Market

Altinoglu, Levent; Stiglitz, Joseph E. - 2020

The concentration of risk within financial system is considered to be a source of systemic instability. We propose a theory to explain the structure of the financial system and show how it alters the risk taking incentives of financial institutions. We build a model of portfolio choice and...

Persistent link: https://www.econbiz.de/10014351992

Monitoring, Bailouts, and Penalties : An Integrated Framework of Government Policies to Manage the Too Big to Fail Problem

Gong, Ning - 2013

This paper discusses optimal government bailout policy where the costs of systemic failures and moral hazard problems are considered. We find that a three-tiered bailout policy that includes an ex post monitoring and bailout scheme for institutions with large systemic impacts ('Too Big to Fail')...

Persistent link: https://www.econbiz.de/10013094393

Can Network Governance Reduce Risks for Financial Firms Too Big to Fail?

Turnbull, Shann - 2013

This paper compares the competitiveness and resilience of firms governed by a single board that were considered “too big to fail” in 2008 with firms governed by a network of boards. Network governance introduces a division of power, checks and balances with stakeholder engagement....

Persistent link: https://www.econbiz.de/10013095215

Central bank liquidity policy in modern times

Brooks, Skylar - 2024

Central banks play a crucial role in promoting financial stability. They act as financial system stabilizers through their capacity to create liquidity and channel it to financial institutions and markets in times of stress - a role that has evolved and expanded substantially over the past 15...

Persistent link: https://www.econbiz.de/10014577846

Fiscal-financial vulnerabilities

Schuknecht, Ludger - 2019

The paper analyses the linkages from financial developments to public finances. It maps and discusses the transmission channels to fiscal variables. These channels include asset prices, financing conditions, balance sheets of banks, non-banks and central banks and international linkages. The...

Persistent link: https://www.econbiz.de/10012050685

Recreating the South Sea bubble : lessons from an experiment in financial history

Giusti, Giovanni; Noussair, Charles; Voth, Hans-Joachim - 2014

Major bubble episodes are rare events. In this paper, we examine what factors might cause some asset price bubbles to …

Persistent link: https://www.econbiz.de/10010359796

Detecting asset price bubbles with time-series methods

Taipalus, Katja - 2012

conventional unit root tests in modified forms can be used to construct early warning indicators for bubbles in financial markets … 1871, they are able to signal most of the consensus bubbles, defined as stock market booms for example by the IMF, and they … bubbles from the data. Finally, these early warning indicators are applied to data for several housing markets. In most of the …

Persistent link: https://www.econbiz.de/10012148911

Signaling asset price bubbles with time-series methods

Taipalus, Katja - Suomen Pankki - 2012

This paper provides an early warning indicator for bubbles in financial markets. The indicator is based on traditional … consensus bubbles and gives warning signals well ahead of the crash, in most cases as early as 12 months ahead. The indicator … also signals most of the 'negative bubbles' before their turning points. …

Persistent link: https://www.econbiz.de/10010611666