Working paper icon

Working paper

Multinational bank capital regulation with deposit insurance and diversification effects

Abstract:

We analyse a model in which bank deposits are insured and there is an exogenous cost of bank capital. The former effect results in bank overinvestment and the latter in underinvestment. Regulatory capital requirements introduce investment distortions which are a constrained optimal response to these market imperfections. We show that capital requirements which are constrained optimal for national banks result in underinvestment by multinational banks. The extent of underinvestment depends upo...

Expand abstract
Publication status:
Published

Actions


Access Document


Files:
Publisher:
University of Oxford
Series:
Department of Economics Discussion Paper Series
Publication date:
2003-07-01
Paper number:
2003-FE-11
Keywords:
Pubs id:
679188
Local pid:
pubs:679188
Deposit date:
2020-12-14

Terms of use


Views and Downloads






If you are the owner of this record, you can report an update to it here: Report update to this record

TO TOP