Self-Fulfilling Credit Market Freezes

By L. Bebchuk, Itay Goldstein. 2011

188 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/3ab6f4b5a8c62ef00193ffcb18da2c592d8382ec

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Citations in the corpus

Who Matters in Coordination Problems (2012, background): “We call inequality (1) the belief constraint.”
Bank liquidity creation and risk-taking: : Does managerial ability matter? (2016, unknown): “On the other hand, the theory of Bebchuk and Goldstein (2011) suggests the opposite.”
Incomplete Information in Macroeconomics: Accommodating Frictions in Coordination (2016, unknown): “Bebchuk and Goldstein (2011) study a debt crisis model in which a credit-market freeze—a situation in which banks abstain from lending to good firms—may arise because of the banks’ self-fulfilling expectations that other banks will not lend. The authors “globalize” the model to study the effectivene”
An Overview of Macroprudential Policy Tools (2014, unknown): “Spillovers can arise because of bilateral balance sheets (interbank) and other exposures (Allen and Gale, 2000; Diamond and Rajan, 2011; Perotti and Suarez, 2011), asset price movements (as discussed above), or aggregate feedback from the real economy (Bebchuk and Goldstein, 2011).”
Systemic Risk in Financial Networks: A Survey (2020, unknown): “One way to eliminate this source of systemic fragility is to have the regulator insure all lending, either via deposit insurance (Diamond & Dybvig (1983)) or by committing to be the lender of last resort and inject capital whenever necessary (Diamond & Rajan (2011); Bebchuk & Goldstein (2011)).”
Benefits and Costs of Bank Capital (2016, background): “Then, a relatively poorer real-sector performance resulting from the contraction in aggregate credit would confirm their expectations and validate their strategy (Bebchuk and Goldstein 2011).”
Strategic Complementarity, Fragility, and Regulation (2014, background): “Consider Bebchuk and Goldstein’s (2011) model of self-fulfilling freezes in credit markets, which is a variation of the loan foreclosure model proposed by Morris and Shin (2004).”
To what extent did the economic stimulus package influence bank lending and corporate investment decisions? Evidence from China (2018, background): “…with low efficiency due to political interventions (Dinc, 2005; Khwaja and Mian, 2005; Sapienza, 2004), others argue that government lending can cure market failure and improve welfare by providing more capital (Bebchuk and Goldstein, 2011).”
Bank Ratings and Lending Supply: Evidence from Sovereign Downgrades (2016, unknown): “, Gorton and Huang 2004; Bebchuk and Goldstein 2011; Duchin and Sosyura 2012; Philippon and Schnabl 2013). We focus on foreign currency long-term issuer ratings, in which agencies use a sovereign’s rating as a strong upper bound on the ratings of issuers located within each country. We prefer S&P’s ”
E¢ cient Recapitalization (2010, unknown): “Bebchuk and Goldstein (2009) study bank bailouts in a model where banks may not lend because of self-ful lling credit market freezes.”