Market Frictions, Interbank Linkages and Excessive Interconnections /

This paper studies banks' decision to form financial interconnections using a model of financial contagion that explicitly takes into account the crisis state of the world. This allows us to model the network formation decision as optimising behaviour of competitive banks, where they balance th...

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Bibliografske podrobnosti
Glavni avtor: Deb, Pragyan
Format: Revija
Jezik:English
Izdano: Washington, D.C. : International Monetary Fund, 2016.
Serija:IMF Working Papers; Working Paper ; No. 2016/180
Online dostop:Full text available on IMF
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300 |a 1 online resource (41 pages) 
490 1 |a IMF Working Papers 
500 |a <strong>Off-Campus Access:</strong> No User ID or Password Required 
500 |a <strong>On-Campus Access:</strong> No User ID or Password Required 
506 |a Electronic access restricted to authorized BRAC University faculty, staff and students 
520 3 |a This paper studies banks' decision to form financial interconnections using a model of financial contagion that explicitly takes into account the crisis state of the world. This allows us to model the network formation decision as optimising behaviour of competitive banks, where they balance the benefits of forming interbank linkages against the cost of contagion. We use this framework to study various market frictions that can result in excessive interconnectedness that was seen during the crisis. In this paper, we focus on two channels that arise from regulatory intervention-deposit insurance and the too big to fail problem. 
538 |a Mode of access: Internet 
830 0 |a IMF Working Papers; Working Paper ;  |v No. 2016/180 
856 4 0 |z Full text available on IMF  |u http://elibrary.imf.org/view/journals/001/2016/180/001.2016.issue-180-en.xml  |z IMF e-Library