A unique data set is used to examine the determinants of membership in theYankee 24 shared Automated Teller Machine (ATM) network. Recent work suggeststhat the presence of demand side network externalities influences the decisionto join a network. A model is constructed in which characteristics...

As liquidity conditions in the term funding markets grew increasingly strained in late 2007, the Federal Reserve began making funds available directly to banks through a new tool, the Term Auction Facility (TAF). The TAF provides term funding on a collateralized basis, at interest rates and...

This comment letter was submitted in response to the Office of the Comptroller of the Currency (OCC) advance notice of proposed rule-making regarding the digital activities of National Banks and Savings Associations. For the reasons set out in this letter, we believe that the OCC's proposed...

The policy measures taken since the financial crisis have greatly expanded the size of the Federal Reserve's balance sheet and have thus raised the level of aggregate bank reserves as well. Over the same period there has been a significant shift in the timing of payments made over the Federal...

In a floor system of monetary policy implementation, the central bank remunerates bank reserves at or near the market rate of interest. Some observers have expressed concern that operating such a system will have adverse fiscal consequences for the public sector and may even require the...

The Term Auction Facility (TAF), the first auction-based liquidity initiative by the Federal Reserve during the global financial crisis, was aimed at improving conditions in the dollar money market and bringing down the significantly elevated London interbank offered rate (Libor). The...

It takes many years for more efficient electronic payments to be widely used, and the fees that merchants (consumers) pay for using those services are increasing (decreasing) over time. We address these puzzles by studying payments system evolution with a dynamic model in a two-sided market...

We argue that the defining feature of large and complex banks that makes their failures messy is their reliance on runnable financial liabilities that confer liquidity or money-like services that may be impaired or destroyed in bankruptcy. To make large bank failures more orderly, we advocate...

The failure and near-collapse of some of the largest dealer banks on Wall Street in 2008 highlighted the profound complexity of the industry. Dealer banks are financial intermediaries that make markets for many securities and derivatives. Like standard banks, funding for a loan made by a dealer...

The authors present an analytical framework for bank complexity through the hypothesis that complexity is necessary for banks to stay viable in the evolving industry of financial intermediation. They look at organizational structures of bank holding companies gauged by the number and types of...