Optimal Prudential Regulation of Banks and the Political Economy of Supervision is popular PDF and ePub book, written by Mr.Thierry Tressel in 2014-05-28, it is a fantastic choice for those who relish reading online the Business & Economics genre. Let's immerse ourselves in this engaging Business & Economics book by exploring the summary and details provided below. Remember, Optimal Prudential Regulation of Banks and the Political Economy of Supervision can be Read Online from any device for your convenience.
Optimal Prudential Regulation of Banks and the Political Economy of Supervision Book PDF Summary
We consider a moral hazard economy in banks and production to study how incentives for risk taking are affected by the quality of supervision. We show that low interest rates may generate excessive risk taking. Because of a pecuniary externality, the market equilibrium may not be optimal and there is a need for prudential regulation. We show that the optimal capital ratio depends on the macro-financial cycle, and that, in presence of production externalities, it should be complemented by a constraint on asset allocation. We show that the political process tends to exacerbate excessive risk taking and credit cycles.
Detail Book of Optimal Prudential Regulation of Banks and the Political Economy of Supervision PDF
- Author : Mr.Thierry Tressel
- Release : 28 May 2014
- Publisher : International Monetary Fund
- ISBN : 9781498389488
- Genre : Business & Economics
- Total Page : 61 pages
- Language : English
- PDF File Size : 9,9 Mb
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