We study a politician's choice for state or private control of banks. The choice trades of lobbying contributions against social welfare, weighted by political accountability.Politicians facing few constraints prefer state control to maximize their rents. As state banks are less efficient, at...

Some have suggested that weaknesses in bank corporate governance played a prominent role in the recent financial crisis, most notably through poorly designed executive compensation packages and from various aspects of the public safety net that may have blunted the normal forces of market...