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http://dspace.mediu.edu.my:8181/xmlui/handle/10419/19894| Title: | Banks without Parachutes : Competitive Effects of Government Bail-out Policies |
| Keywords: | L11 G28 G21 ddc:330 Government bail-out banking competition transparency "too big to fail" financial stability Bankrisiko Bank Risikofreude Unternehmenssanierung Einlagensicherung Wettbewerb Bankenkrise Theorie |
| Issue Date: | 16-Oct-2013 |
| Publisher: | |
| Description: | The explicit or implicit protection of banks through government bail-out policies is a universal phenomenon. We analyze the competitive effects of such policies in two models with different degrees of transparency in the banking sector. Our main result is that the bail-out policy unambiguously leads to higher risk-taking at those banks that do not enjoy a bail-out guarantee. The reason is that the prospect of a bail-out induces the protected bank to expand, thereby intensifying competition in the deposit market and depressing other banks? margins. In contrast, the effects on the protected bank?s risk-taking and on welfare depend on the transparency of the banking sector. |
| URI: | http://koha.mediu.edu.my:8181/xmlui/handle/10419/19894 |
| Other Identifiers: | http://hdl.handle.net/10419/19894 ppn:477634664 |
| Appears in Collections: | EconStor |
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