Leverage, Moral Hazard and Liquidity

By V. Acharya, S. Viswanathan, Arvind Krishnamurthy, Praveen Kumar, Xuewen Liu, Martin Oehmke, Guillaume Plantin, Adriano A. Rampini, Jean-Charles Rochet, Jose A. Scheinkman and 3 more. 2010

405 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/f22e9fa085535073b0665e789035a5b02fd97620

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Citations in the corpus

The Hazards of Debt: Rollover Freezes, Incentives, and Bailouts (2012, background): “Short-term creditors refused to roll over their debt for fear of future deterioration in the real estate market, leading to financial distress for those firms far exceeding the level of losses (Brunnermeier, 2009). Under this view, short-term debt creates a liability-side risk, or funding risk, for ”
Market Timing, Investment, and Risk Management (2012, neutral): “For example, in bad times, assets are often sold at a deep discount (see Shleifer and Vishny, 1992; Acharya and Viswanathan, 2011), which can be captured in this model by making ys large when financing conditions are tough. Finally, the firm can liquidate its assets at any time and obtain a liquidat”
The Relationship between Liquidity Risk and Credit Risk in Banks (2014, background): “…as Goldstein and Pauzner (2005), Wagner (2007), Cai and Thakor (2008), Gatev, Schuermann and Strahan (2009), Acharya, Shin and Yorulmazer (2010), Acharya and Viswanathan (2011), Gorton and Metrick (2011), He and Xiong (2012a, b), and Acharya and Mora (2013) look into the matter from various…”
Monetary Policy, Leverage, and Bank Risk-Taking (2010, neutral): “…liquidity spirals that such risk could generate in the event of negative shocks (see Diamond and Rajan, 2008; Brunnermeier and Pedersen, 2009; and Acharya and Viswanathan, 2010) and on the role of monetary policy in altering bank fragility in the presence of liquidity risk (Acharya and Naqvi,…”
Bank Leverage Cycles (2017, neutral): “of ’islands’, indexed by j ∈ [0, 1].”
Bubbles, Financial Crises, and Systemic Risk (2012, neutral): “Acharya and Viswanathan (2011) provide a model in which both the need to sell assets and the limited ability to buy at an interim date arise from moral hazard concerns that lead to credit rationing.”
Small business financing in the UK before and during the current financial crisis (2012, background): “Acharya and Viswanathan (2011) suggest that following the sudden drying-up of liquidity in adverse economic shocks, greater credit rationing and de-leveraging in the economy are expected to be observed.”
Understanding FX Liquidity (2015, background): “sheds light on the intricate dynamics between market liquidity, funding constraints and risk (e.g., Vayanos and Gromb 2002; Morris and Shin 2004; Brunnermeier and Pedersen 2009; Acharya and Viswanathan 2011).”
The Interactional Relationships Between Credit Risk, Liquidity Risk and Bank Profitability in MENA Region (2020, background): “They stated that the financing of risky or distressed project leads to an increase in NPLs that decreases bank liquidity and struggle banks to meet depositors’ demands for funds (Acharya & Viswanathan, 2011; Gorton & Metrick, 2011; He & Xiong, 2012).”
Real interest rates, leverage, and bank risk-taking (2014, background): “20 A growing literature focuses on funding liquidity risk of banks and the adverse liquidity spirals that such risk could generate in the event of negative shocks (see [27,19,3]) and on the role of monetary policy in altering bank fragility in the presence of liquidity risk ([2]; and [31]).”
Limits to arbitrage during the crisis: funding liquidity constraints and covered interest parity (2011, neutral): “crisis is documented and discussed in Adrian and Shin (2008b) and McCauley and McGuire (2009), among others. Garleanu and Pedersen (2011) also focus on deleveraging and suggest a model in which assets with lower margin requirements – with less impact on the balance sheet – can trade at lower prices.”