Bank Bail-Outs, International Linkages and Cooperation

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dc.contributor.author NIEPMANN, Friederike
dc.contributor.author SCHMIDT-EISENLOHR, Tim
dc.date.accessioned 2010-02-18T15:48:46Z
dc.date.available 2010-02-18T15:48:46Z
dc.date.issued 2010
dc.identifier.issn 1725-6704
dc.identifier.uri http://hdl.handle.net/1814/13342
dc.description.abstract Financial institutions are increasingly linked internationally and engaged in cross-border operations. As a result, financial crises and potential bail-outs by governments have important international implications. Extending Allen and Gale (2000) we provide a model of international contagion allowing for bank bail-outs financed by distortionary taxes. In the sequential game between governments, there are inefficiencies due to spillovers, free-riding and limited burden-sharing. When countries are of equal size, an increase in cross-border deposit holdings improves, in general, the non-cooperative outcome. For efficient crisis managment, ex-ante fiscal burden sharing is essential as ex-post contracts between governments do not achieve the same global welfare. en
dc.language.iso en en
dc.relation.ispartofseries EUI ECO en
dc.relation.ispartofseries 2010/05 en
dc.subject bail-out en
dc.subject contagion en
dc.subject financial crisis en
dc.subject international institutional arrangements en
dc.subject F36 en
dc.subject F42 en
dc.subject G01 en
dc.subject G28 en
dc.title Bank Bail-Outs, International Linkages and Cooperation en
dc.type Working Paper en
dc.neeo.contributor NIEPMANN|Friederike|aut|
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