Demand-deposit contracts and the probability of bank runs
show that while demand?deposit contracts let banks provide liquidity, they expose them to panic-based bank runs. However, their model does not provide tools to derive the probability of the bank-run equilibrium, and thus cannot determine whether banks increase welfare overall. We study a modified model in which the fundamentals determine which equilibrium occurs. This lets us compute the ex ante probability of panic-based bank runs and relate it to the contract. We find conditions under which banks increase welfare overall and construct a demand?deposit contract that trades off the benefits from liquidity against the costs of runs..Printed Journal
Ketersediaan
Call Number | Location | Available |
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| PSB lt.dasar - Pascasarjana | 1 |
Penerbit |
The American Finance Association.,
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Edisi |
- |
Subjek |
- |
ISBN/ISSN |
221082 |
Klasifikasi |
- |
Deskripsi Fisik |
- |
Info Detail Spesifik |
- |
Other Version/Related |
Tidak tersedia versi lain |
Lampiran Berkas |
Tidak Ada Data
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