Has Financial Development Made the World Riskier? 1

By Raghuram G. Rajan. 2005

1,163 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/e32e2c73b011d4dc5de2636be1a4cc456f8bbb0f

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Citations in the corpus

Why Do (or Did?) Banks Securitize Their Loans? Evidence from Italy (2010, background): “…negative view, which became predominant after the financial turmoil (BIS, 2008; ECB, 2008; FSF, 2008a) but existed before it (CGFS, 2003 and 2005; Rajan, 2005; Fender and Mitchell, 2005; BIS, 2006; Allen and Carletti, 2006), emphasizes that the securitization chain misaligns incentives, leads to…”
In Search for Yield? Survey-Based Evidence on Bank Risk Taking (2014, background): “There is growing consensus that the conduct of monetary policy can have an impact on financial and economic stability through the risk-taking incentives of banks (Rajan 2005, Borio and Zhu 2008).”
Monetary Policy, Financial Conditions, and Financial Stability (2014, background): “Rajan (2005, 2006) argues that low interest rates can lead to compressed risk premiums because they increase the incentives for investors to “reach for yield.””
Macroprudential Policy - A Literature Review (2012, positive): “The second captures the “search for yield” effect (Rajan, 2005).”
Unconventional monetary policies: a re-appraisal (2018, background): “…to shift into riskier assets – an aspect of the socalled “risk-taking channel”.7,8 7 For an introduction to the risk-taking channel, see Borio and Zhu (2012); for further elaboration or examples, see, in particular, Rajan (2005); for its operation in the context of exchange rates, see Shin (2012)).”
How does credit supply respond to monetary policy and bank minimum capital requirements (2016, background): “…rates can increase banks’ net worth (Adrian and Shin 2010), reduce asset volatility and thereby reduce perceptions of risk (Borio and Zhu 2008), and make nominal target returns harder to achieve (Rajan 2005).6 This may lead to an increase in banks’ appetite for risk, and therefore, riskier lending.”
Real interest rates, leverage, and bank risk-taking (2014, background): “Rajan [42] identifies, in the “search for yield,” a related mechanism through which changes in the reference rate may affect risk taking.”
The Revenge of the Market on the Rentiers: Why neo-liberal Reports of the end of history turned out to be premature (Updated 19 December 2011) (2009, background): “127 As Rajan and Zingales say (2004), those that want to save capitalism should start by trying to”
Monetary policy and risk taking (2015, background): “In the presence of low and persistent interest rates levels, asset managers of banks and other investment pools may have an incentive to shift the composition of their investments towards a riskier mix (see for instance Rajan [40]).”
Issuer Quality and Corporate Bond Returns (2013, background): “Rajan (2005) argues that certain institutional investors “reach for yield” when riskless interest rates are low or have recently fallen, hinting that the low flat yield curve of 2005-2006 may have led institutional investors to take on excessive risks.”
Effects of Unconventional Monetary Policy on Financial Institutions (2014, background): “Investment management poses a classic principle-agent problem, in which the incentives of managers may not align perfectly with the objectives of shareholders and debt holders (Jensen and Meckling, 1976; Rajan, 2005).”
Monetary and Macroprudential Policy Rules in a Model with House Price Booms (2009, neutral): “" ct = Et ct+1 (1 ")(rt Et pt+1); (32) ct "ct 1 1 " + [(' L) + L] l C t + (' L)(1 )l t = !t ; (33) and ct "ct 1 1 " + [(' L)(1 ) + L] l D t + (' L) l t = !t : (34)”
New Evidence on the Determinants of Bank Risk (2006, background): “2 See Geithner (2004) and Rajan (2005) for discussions of the evolution of US banking and financial markets, increased complexity, changing incentives, and risk implications.”
What Drives Spreads in the Euro Area Government Bond Market? (2007, positive): “One economic rationale behind the strong correlation between spreads and short term interest rates may lie in the compensation structure of investment managers, as recently suggested by Rajan (2005). When interest rates are low, investors have greater incentives to take on risk, in”