This paper offers a comprehensive comparison of the structure of banking and financial markets in the euro area. Based on this, several hypotheses about the role of banks in monetary policy transmission are developed. Many of the predictions that have been proposed for the U.S. are deemed...

In a simple risk-sharing environment with ex post private information, conditions are found under which a collateralized debt contract is the optimal allocation. The critical condition for optimality is that the borrower values the collateral good more highly than does the lender; otherwise the...

In a two-agent, two-good, private information, risk-sharing environment, conditions are described under which a collateralized debt contract is the optimal allocation within the set of all resource and incentive feasible allocations, even allowing for extraneous randomization. In a...

In an economy which is facing more and more the consequences of the international financial crisis, one should find solutions to answer the population's credit demands first and foremost. Since the banks' crediting conditions have become harder, their clients started looking for alternative...

We extend the study of banking equilibrium in Berentsen, Camera and Waller (2007) by introducing an explicit production function for banks. Banks employ labor resources, hired on a competitive market, to run their operations. In equilibrium this generates a spread between interest rates on loans...

We analyse the forecasting power of different monetary aggregates and credit variables for US GDP. Special attention is paid to the influence of the recent financial market crisis. For that purpose, in the first step we use a three-variable single-equation framework with real GDP, an interest...