Semantic Scholar Open Access 2009 469 sitasi

Unstable Banking

Robert W. Vishny A. Shleifer

Lihat Sumber DOI

Abstrak

We propose a theory of financial intermediaries operating in markets influenced by investor sentiment. In our model, banks make loans, securitize these loans, trade in them, or hold cash. They can also borrow money, using their security holdings as collateral. We embed such banks in a stylized financial market, in which securitized loans may be mispriced, and investigate how banks allocate limited capital among the various activities, as well as how they choose their capital structure. Banks maximize profits, and there are no conflicts of interest between bank shareholders and creditors. The theory explains the cyclical behavior of credit and investment, but also accounts for the fundamental instability of banks operating in financial markets, especially when banks use leverage.

Penulis (2)

Robert W. Vishny

A. Shleifer

Format Sitasi

APA MLA BibTeX

Vishny, R.W., Shleifer, A. (2009). Unstable Banking. https://doi.org/10.1016/j.jfineco.2009.10.007

Akses Cepat

Lihat di Sumber doi.org/10.1016/j.jfineco.2009.10.007

Informasi Jurnal

Tahun Terbit: 2009
Bahasa: en
Total Sitasi: 469×
Sumber Database: Semantic Scholar
DOI: 10.1016/j.jfineco.2009.10.007
Akses: Open Access ✓