Banking systems and bankruptcy codes define the legal environment in which financial contracts are concluded by, respectively, restricting financial intermediaries to certain contracts and defining reorganization proceedings. The theoretical link between these two institutions are thus financial...

Banking systems have historically evolved toward their present state in response to particular economic or institutional challenges and through legislative or regulatory intervention. Drawing on the evolution of the German financial system toward universal financial intermediation in the second...

The inability to reconcile observed levels of foreign exchange rate volatility with predictions derived from rational expectations models represents one of the most persistent challenges in international nance. This paper shows that such excess volatility puzzles arise from informational...

Market discipline for financial institutions can be imposed not only from the liability side, as has often been stressed in the literature on the use of subordinated debt, but also from the asset side. This will be particularly true if good lending opportunities are in short supply, so that...

We consider the advantages and disadvantages of stakeholder-oriented firms that are concerned with employees and suppliers as well as shareholders compared to shareholderoriented firms. Societies with stakeholder-oriented firms have higher prices, lower output, and can have greater firm value...