Government guarantees and financial stability

• 成果类型: Article
• 署名作者: Allen, Franklin; Carletti, Elena; Goldstein, Itay; Leonello, Agnese
• 署名单位: Imperial College London; Bocconi University; Centre for Economic Policy Research - UK; University of Pennsylvania; European Central Bank
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2018.06.007
• 发表日期: 2018
• 页码: 518-557
• 关键词: Panic runs; Fundamental runs; Government guarantees; Bank moral hazard

摘要

Banks are intrinsically fragile because of their role as liquidity providers. This results in under-provision of liquidity. We analyze the effect of government guarantees on the interconnection between banks' liquidity creation and likelihood of runs in a global-game model, where banks' and depositors' behavior are endogenous and affected by the amount and form of guarantee. The main insight of our analysis is that guarantees are welfare improving because they induce banks to improve liquidity provision, although that sometimes increases the likelihood of runs or creates distortions in banks' behavior. (C) 2018 Elsevier Inc. All rights reserved.