Financial opening, deposit insurance, and risk in a model of banking competition
We study the impact of competition on banks' risk-taking behavior under different assumptions about deposit insurance and the dissemination of financial information. While opening increases banks' riskiness, a risk-based deposit insurance or, alternatively, the public disclosure of financi...
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2002
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| Acceso en línea: | https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v46_n3_p471_Cordella http://hdl.handle.net/20.500.12110/paper_00142921_v46_n3_p471_Cordella |
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paper:paper_00142921_v46_n3_p471_Cordella2023-06-08T14:36:35Z Financial opening, deposit insurance, and risk in a model of banking competition Bank competition Deposit insurance Financial opening Information disclosure Risk banking competition (economics) financial services welfare impact We study the impact of competition on banks' risk-taking behavior under different assumptions about deposit insurance and the dissemination of financial information. While opening increases banks' riskiness, a risk-based deposit insurance or, alternatively, the public disclosure of financial information, are likely to mitigate this effect. Moreover, the limiting cases of uninsured but fully informed depositors, and risk-based full deposit insurance, yield the same equilibrium risk level. Although the welfare consequences of increased competition depend on its impact on risk, financial opening unambiguously improves welfare as we approach the limiting cases. © 2002 Elsevier Science B.V. All rights reserved. 2002 https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v46_n3_p471_Cordella http://hdl.handle.net/20.500.12110/paper_00142921_v46_n3_p471_Cordella |
| institution |
Universidad de Buenos Aires |
| institution_str |
I-28 |
| repository_str |
R-134 |
| collection |
Biblioteca Digital - Facultad de Ciencias Exactas y Naturales (UBA) |
| topic |
Bank competition Deposit insurance Financial opening Information disclosure Risk banking competition (economics) financial services welfare impact |
| spellingShingle |
Bank competition Deposit insurance Financial opening Information disclosure Risk banking competition (economics) financial services welfare impact Financial opening, deposit insurance, and risk in a model of banking competition |
| topic_facet |
Bank competition Deposit insurance Financial opening Information disclosure Risk banking competition (economics) financial services welfare impact |
| description |
We study the impact of competition on banks' risk-taking behavior under different assumptions about deposit insurance and the dissemination of financial information. While opening increases banks' riskiness, a risk-based deposit insurance or, alternatively, the public disclosure of financial information, are likely to mitigate this effect. Moreover, the limiting cases of uninsured but fully informed depositors, and risk-based full deposit insurance, yield the same equilibrium risk level. Although the welfare consequences of increased competition depend on its impact on risk, financial opening unambiguously improves welfare as we approach the limiting cases. © 2002 Elsevier Science B.V. All rights reserved. |
| title |
Financial opening, deposit insurance, and risk in a model of banking competition |
| title_short |
Financial opening, deposit insurance, and risk in a model of banking competition |
| title_full |
Financial opening, deposit insurance, and risk in a model of banking competition |
| title_fullStr |
Financial opening, deposit insurance, and risk in a model of banking competition |
| title_full_unstemmed |
Financial opening, deposit insurance, and risk in a model of banking competition |
| title_sort |
financial opening, deposit insurance, and risk in a model of banking competition |
| publishDate |
2002 |
| url |
https://bibliotecadigital.exactas.uba.ar/collection/paper/document/paper_00142921_v46_n3_p471_Cordella http://hdl.handle.net/20.500.12110/paper_00142921_v46_n3_p471_Cordella |
| _version_ |
1768543928569561088 |