منابع مشابه
Private Money and Banking Regulation ⇤
We show that the regulation of lending practices is desirable for the optimal provision of private money. In an environment in which bankers cannot commit to repay their creditors, neither an unregulated banking system nor a form of narrow banking in which banks hold 100% in reserves can provide the socially efficient amount of money. If bankers provided such an amount, then they would prefer t...
متن کاملWorking Paper No. 15-19 Private Money and Banking Regulation
We show that a competitive banking system is inconsistent with an optimum quantity of private money. Because bankers cannot commit to their promises and the composition of their assets is not publicly observable, a positive franchise value is required to induce the full convertibility of bank liabilities. Under perfect competition, a positive franchise value can be obtained only if the return o...
متن کاملPrivate Liquidity and Banking Regulation
We show that the regulation of bank lending practices is necessary for the optimal provision of private liquidity. In an environment in which bankers cannot commit to repay their creditors, we show that neither an unregulated banking system nor narrow banking can provide the socially e¢ cient amount of liquidity. If the bankers provided such an amount, then they would prefer to default on their...
متن کاملWorking Paper No. 12-11/r Private Money and Banking Regulation
We establish a fundamental relationship between the return on the banking sectors assets and each bankers willingness to supply liabilities that facilitate payments and settlement (private money). In particular, we show that the regulation of lending practices is necessary for the optimal provision of private money. In an environment in which bankers cannot commit to their promises, an unregu...
متن کاملMoney, credit and banking
In monetary models in which agents are subject to trading shocks there is typically an ex-post inefficiency in that some agents are holding idle balances while others are cash constrained. This inefficiency creates a role for financial intermediaries, such as banks, who accept nominal deposits and make nominal loans. We show that in general financial intermediation improves the allocation and t...
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ژورنال
عنوان ژورنال: SSRN Electronic Journal
سال: 2015
ISSN: 1556-5068
DOI: 10.2139/ssrn.2646092