G01 - Financial Crises

• Democratic Political Economy of Financial Regulation

  Staff Working Paper 2021-59 Igor Livshits, Youngmin Park

  We offer a theory of how inefficiently lax financial regulation could arise in a democratic society.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial stability, Financial system regulation and policies, Housing, Interest rates JEL Code(s): E, E4, E43, E44, G, G0, G01, G2, G21, G28, P, P4, P48

• Are Bank Bailouts Welfare Improving?

  Staff Working Paper 2021-56 Malik Shukayev, Alexander Ueberfeldt

  Financial sector bailouts, while potentially beneficial during a crisis, might lead to excessive risk taking if anticipated. Taking expectations and aggregate risk implications into account, we show that bailouts can be welfare improving, but only if capital adequacy constraints are sufficiently tight.

  Content Type(s): Staff research, Staff working papers Topic(s): Financial institutions, Financial stability, Financial system regulation and policies JEL Code(s): D, D6, D62, E, E3, E32, E4, E44, G, G0, G01