Princeton University Library Catalog

Market Frictions, Interbank Linkages and Excessive Interconnections [electronic resource] / Pragyan Deb.

Author:
Deb, Pragyan [Browse]
Format:
Book
Language:
English
Published/​Created:
[Washington, D.C.: International Monetary Fund, 2016]
Description:
1 online resource (41 p.)
Series:
IMF Working Papers [More in this series]
Summary note:
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.
Source of description:
Description based on print version record.
ISBN:
1475530293 :
Doi:
  • 10.5089/9781475530292.001
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