Work

On the Fundamental Reasons for Bank Fragility

Year: 2010

Type: article

Abstract: A substantial body of literature has now developed as a result of efforts to identify the fundamental reasons for the fragility of financial intermediaries in the Diamond-Dybvig theory of banking. Many of these articles focus on the interaction between sequential service and uncertainty about the aggregate need for liquidity in the economy. The articles in this literature are inevitably technical and focus somewhat narrowly on the implications of specific assumptions. Here, we provide a more accessible discussion of the main ideas and findings in this literature. Our discussion can be used as an introduction to the more technical articles or as an organizing framework for understanding the relative contribution of the main articles in this literature.

Source: RePEc: Research Papers in Economics

Authors: Huberto M. Ennis, Todd Keister

Institutions: Federal Reserve, Federal Reserve Bank of Richmond, Rutgers, The State University of New Jersey

Language: English

Topic: Banking stability, regulation, efficiency

Subfield: Finance

Field: Economics, Econometrics and Finance

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W1585562385

FWCI: 1.672

Cites: 2

Cited by: 30

Related to: 10