Abstract
We model a banking union of two countries whose banking sectors differ in their average probability of failure and externalities between the two countries arise from cross-border bank ownership. The two countries face (i) a regulatory (supervisory) decision of which banks are to be shut down before they can go bankrupt, and (ii) a bailout decision of who pays for banks that have failed despite regulatory oversight. Each of these choices can either be taken in a centralized or in a decentralized way. In our benchmark model the two countries always agree on a centralized regulation policy. In contrast, bailout policies are centralized only when international spillovers from cross-border bank ownership are strong, and banking sectors are highly profitable. (c) 2021 Elsevier B.V. All rights reserved.
Dokumententyp: | Zeitschriftenartikel |
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Fakultät: | Volkswirtschaft |
Themengebiete: | 300 Sozialwissenschaften > 330 Wirtschaft |
ISSN: | 0378-4266 |
Sprache: | Englisch |
Dokumenten ID: | 98800 |
Datum der Veröffentlichung auf Open Access LMU: | 05. Jun. 2023, 15:29 |
Letzte Änderungen: | 17. Okt. 2023, 14:59 |