Does the New European Banking Regulation discourage Earnings Management?

New Issues in Banking Regulation

Khartabil provided exceptional research assistance. The views expressed in the paper are those of the author and do not necessarily reflect the opinions of the International Monetary Fund.

Accounting based regulation and earnings management

We document the distortionary effects of accounting-based regulation on reported earnings. In India only firms with negative book value of equity (networth) can seek bankruptcy protection. Using a novel dataset of bankrupt firms from India, we show that firms manage earnings downward to seek bankruptcy protection. Strengthening creditor rights reduces downward earnings management among non-grou...

Risk Management, Financial Contagion, and Banking Regulation

Risk management is a central function of banks. Our model examines how banks use this ability to shift risk away from entrepreneurs. To create incentive compatibility, banks must assume some of the entrepreneurial risks, e. g. by underwriting OTC hedging contracts or granting loans. The arising bankruptcy risk causes potential contagion. A conflict of interest emerges because banks prefer a div...

Preliminary draft Competition and Regulation in European banking

Does monitoring newborn weight discourage breast feeding?

BACKGROUND A policy of regular neonatal weight monitoring was introduced to a geographically defined population in 2000. This was combined with targeted breast feeding support for infants reaching specified intervention thresholds. AIMS To look for evidence of compromise in breast feeding rates as a result of this policy change. METHODS Breast feeding rates at 10 days and 6 weeks were compa...