Risky bank lending and optimal capital adequacy regulation /

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Bibliographic Details
Author / Creator:	Beneš, Jaromír, 1973- author.
Imprint:	[Washington, D.C.] : International Monetary Fund, ©2011.
Description:	1 online resource (28 pages)
Language:	English
Series:	IMF working paper ; WP/11/130 IMF working paper ; WP/11/130.
Subject:	Bank loans -- Econometric models. Asset requirements -- Econometric models. Bank loans -- Econometric models.
Format:	E-Resource Book
URL for this record:	http://pi.lib.uchicago.edu/1001/cat/bib/12499353

Hidden Bibliographic Details
Other authors / contributors:	Kumhof, Michael, author. International Monetary Fund. Research Department, issuing body.
ISBN:	1283570351 9781283570350 9781455294657 1455294659 1455296678 9781455296675 9786613882806 6613882801 145529263X 9781455292639 9781455259359 1455259357
Notes:	Includes bibliographical references. English.
Summary:	We study the welfare properties of a New Keynesian monetary economy with an essential role for risky bank lending. Banks lend funds deposited by households to a financial accelerator sector, and face penalties for maintaining insufficient net worth. The loan contract specifies an unconditional lending rate, which implies that banks can make loan losses. Their main response is to raise lending rates to rebuild net worth. Prudential rules that adjust minimum capital adequacy requirements in response to loan losses significantly increase welfare. But the gains from eliminating limited liability and moral hazard would be an order of magnitude larger.
Other form:	Print version: Benes, Jaromir. Risky Bank Lending and Optimal Capital Adequacy Regulation. Washington : International Monetary Fund, ©2011 9781455259359

Table of Contents:

Cover Page; Title Page; Copyright Page; Contents; I. Introduction; II. The Model; A. Households; B. Capital Goods Producers; C. Capital Investment Funds; D. Banks; E. Manufacturers; F. Government; G. Equilibrium; H. Calibration; I. Welfare; III. Results; A. Optimal Coefficient Combination; B. Impulse Response Function.; 1. Firm Riskiness Shock
Impulse Responses; C. Overall Welfare and Policy Instrument Volatility; 2. Welfare and Instrument Volatility; 3. Welfare
Different Model Parameterizations; D. Moral Hazard and Optimal Policy; IV. Conclusion; References; Footnotes.

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