全球智库信息集成服务系统(G2TT): DP16835 Investment and Contagion Tradeoffs between Fair Value and Historical Cost Accounting

G2TT

来源类型	Discussion paper
规范类型	论文
来源ID	DP16835
	DP16835 Investment and Contagion Tradeoffs between Fair Value and Historical Cost Accounting
	Viral Acharya; Saptarshi Mukherjee; Rangarajan K Sundaram
发表日期	2021-12-25
出版年	2021
语种	英语
摘要	We examine the effects of fair-value accounting (FVA) and historical-cost accounting (HCA) regimes on the ex-ante financing of projects by external investors. We formulate a model highlighting the relative merits and demerits of each accounting regime, in particular the sub-optimal continuations under the HCA regime and contagion-induced sub-optimal liquidations under the FVA regime. We show that under homogeneous beliefs about future cash-flows, FVA regime is superior with greater ex-ante financing, even during periods of high market illiquidity, when the failure of some banks leads to adverse spillovers on surviving financial institutions. However, if disclosures under the FVA regime leads to distorted beliefs about future success probabilities, ex-ante financing may suffer under the FVA regime, and it may no longer be superior relative to the HCA regime. In this setting we also analyze the impact on ex-ante financing of (i) ex-post redemption gates, which restrict the extent of investor liquidation under stress, and (ii) government guarantees, which limit the spillovers ex post but may incentivize excessive risk-taking ex ante.
主题	Financial Economics
关键词	Mark to market Financial crises Redemption gates Government guarantees
URL	https://cepr.org/publications/dp16835
来源智库	Centre for Economic Policy Research (United Kingdom)
资源类型	智库出版物
条目标识符	http://119.78.100.153/handle/2XGU8XDN/545760
推荐引用方式 GB/T 7714	Viral Acharya,Saptarshi Mukherjee,Rangarajan K Sundaram. DP16835 Investment and Contagion Tradeoffs between Fair Value and Historical Cost Accounting. 2021.