| 来源类型 | Discussion paper
|
| 规范类型 | 论文
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| 来源ID | DP5110
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| DP5110 Consumption, Wealth, the Elasticity of Intertemporal Substitution and Long-Run Stock Market Returns |
| Carlo A. Favero
|
| 发表日期 | 2005-06-23
|
| 出版年 | 2005
|
| 语种 | 英语
|
| 摘要 | We investigate the optimal regulation of financial conglomerates that combine a bank and a non-bank financial institution. The conglomerate?s risk-taking incentives depend upon the level of market discipline it faces, which in turn is determined by the conglomerate?s liability structure. We examine optimal capital requirements for standalone institutions, for integrated financial conglomerates, and for financial conglomerates that are structured as holding companies. For a given risk profile, integrated conglomerates have a lower probability of failure than either their standalone or decentralized equivalent. However, when risk profiles are endogenously selected conglomeration may extend the reach of the deposit insurance safety net and hence provide incentives for increased risk-taking. As a result, integrated conglomerates may optimally attract higher capital requirements. In contrast, decentralized conglomerates are able to hold assets in the socially most efficient place. Their optimal capital requirements encourage this. Hence, the practice of ?regulatory arbitrage?, or of transferring assets from one balance sheet to another, is welfare-increasing. We discuss the policy implications of our finding in the context not only of the present debate on the regulation of financial conglomerates but also in the light of existing US bank holding company regulation. |
| 主题 | Financial Economics
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| 关键词 | Financial conglomerate
Capital regulation
Regulatory arbitrage
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| URL | https://cepr.org/publications/dp5110
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| 来源智库 | Centre for Economic Policy Research (United Kingdom)
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| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/533999
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推荐引用方式
GB/T 7714 |
Carlo A. Favero. DP5110 Consumption, Wealth, the Elasticity of Intertemporal Substitution and Long-Run Stock Market Returns. 2005.
|
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