The Founding of the Federal Reserve, the Great Depression, and the Evolution of the US Interbank Network

• 成果类型: Article
• 署名作者: Utah System of Higher Education; Utah State University; Federal Reserve System - USA; Federal Reserve Bank - St. Louis
• 刊物名称: JOURNAL OF ECONOMIC HISTORY
• ISSN/ISSBN: 0022-0507
• DOI: 10.1017/S0022050719000792
• 发表日期: 2020
• 页码: 69-99
• 关键词: banking panics; Systemic risk; liquidity provision; connections; contagion

摘要

Financial network structure is an important determinant of systemic risk. This article examines how the U.S. interbank network evolved over a long and important period that included two key events: the founding of the Federal Reserve and the Great Depression. Banks established connections to correspondents that joined the Federal Reserve in cities with Fed offices, initially reducing overall network concentration. The network became even more focused on Fed cities during the Depression, as survival rates were higher for banks with more existing connections to Fed cities, and as survivors established new connections to those cities over time.