Banking

Fan Liang

Layer 1: Overview This paper asks why small firms hold large quantities of liquid assets — cash and cash equivalents that earn low or negative real returns — even when external credit is available. …

Ana Fostel · John Geanakoplos · Gregory Phelan

Layer 1: Overview The paper asks why large gross financial flows exist between similarly rich countries (especially the U.S. and Europe), why financial integration raises rather than lowers asset …

Mitali Das · Gita Gopinath · Helene Hall · Taehoon Kim · Jeremy C. Stein

Layer 1: Overview This paper investigates why non-U.S. central banks accumulate large holdings of dollar-denominated foreign exchange reserves, focusing on a previously under-emphasized motive: the …

Carlo Altavilla · Giacomo Carboni · Michele Lenza · Harald Uhlig

Layer 1: Overview This paper asks whether uncertainty in the interbank market — distinct from general macroeconomic uncertainty — raises the cost of bank credit to firms, and whether bank-specific …

Jianjun Miao · Zhouxiang Shen · Dongling Su

Layer 1: Overview This paper asks how bank holdings of long-term government securities interact with interest-rate-driven monetary tightening to amplify macroeconomic downturns and generate banking …

Giovanni Cespa · Xavier Vives

Layer 1: Overview Research question and motivation: The paper asks why market liquidity sometimes behaves in a stabilizing way (an illiquidity hike curbs liquidity demand and attracts liquidity …

Christiaan van der Kwaak (University of Groningen)

Layer 1: Overview When central banks pay interest on reserves — as the Federal Reserve has done since October 2008 and as is standard operating procedure today — does financing fiscal stimulus by …

Salomon Garcia-Villegas

Layer 1: Overview This paper develops a quantitative general equilibrium model of the U.S. housing finance system that jointly determines mortgage credit and mortgage-backed security (MBS) issuance, …

Kee-Youn Kang · Zijian Wang

Layer 1: Overview Research question and motivation: Digital payments generate vast, high-frequency, transaction-level data that several central banks (Bank of Canada, Swiss National Bank, Eurosystem …

Eunkyung Lee

Layer 1: Overview Research question and motivation. This paper asks how monetary policy transmits to corporate investment through bank credit, and specifically whether the relevant credit margin is …

BEHZAD DIBA · OLIVIER LOISEL

Layer 1: Overview Research question and motivation: Since 2008 the US economy has gone through two zero-lower-bound (ZLB) episodes (Dec 2008–Dec 2015 and Mar 2020–Mar 2022). Standard New Keynesian …

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Layer 1: Overview Research question and motivation: Can banks effectively monitor their peers under asymmetric information? Effective peer monitoring matters for functioning interbank markets and, by …

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Layer 1: Overview Research question and motivation: As central banks worldwide explore retail central bank digital currency (CBDC), the macroeconomic consequences depend heavily on how CBDC interacts …

Christiaan van der Kwaak · Sweder van Wijnbergen

Layer 1: Overview Research question and motivation: Does fiscal stimulus still work when it is financed through a banking system that is undercapitalized and holds large quantities of risky domestic …

RYUICHIRO IZUMI · YANG LI

Layer 1: Overview Research question and motivation: Asset fire sales were a defining feature of the 2007-08 crisis, and post-crisis reforms (Basel III liquidity requirements, Money Market Mutual Fund …

Hiona Balfoussia · Harris Dellas · Dimitris Papageorgiou

Layer 1: Overview This paper studies a transmission channel from sovereign fiscal weakness to banking performance that the literature has largely overlooked: government-provided deposit insurance, …

Luís A.V. Catão · Jan Ditzen · Daniel Marcel Te Kaat

Layer 1: Overview Research question and motivation: The paper asks how far global factors drive the foreign-borrowing component of advanced-economy banks’ non-core funding, and whether exchange …

Antoine L. Noël · Hongfei Sun

Layer 1: Overview Noël and Sun build an information-based theory of capital structure designed to explain the diversity of observed firm financing behavior and the coexistence of distinct optimal …

CHARLES M. KAHN · DAVID MARSHALL · ROBERT L. MCDONALD

Layer 1: Overview This paper develops a theoretical model to explain why financial markets can suffer self-fulfilling liquidity crises and how a central bank acting as a “market-maker of last …

CECILIA DASSATTI · RODRIGO LLUBERAS · FRANCESC RODRIGUEZ-TOUS

Layer 1: Overview Research question and motivation. Banks reluctant to recognize losses on troubled borrowers engage in “loan evergreening”—rolling over or extending credit to delay loss …

Álvaro Fernández-Gallardo · Iván Payá

Layer 1: Overview Research question and motivation. There is now broad consensus that monetary authorities should hold a financial-stability mandate and that macroprudential policy should be part of …

RODRIGO BARBONE GONZALEZ · JOÃO BARATA RIBEIRO BLANCO BARROSO · BERNARDUS FERDINANDUS NAZAR VAN DOORNIK

Layer 1: Overview Research question and motivation: Reserve requirements (RRs) were largely abandoned as a monetary tool in advanced economies after inflation targeting, but emerging markets (EMs) — …

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Layer 1: Overview Research question and motivation: Emerging economies have rapidly accumulated foreign-currency (mostly dollar) debt — the dollar share of 14 emerging economies’ foreign debt …

THORSTEN BECK · PETER BEDNAREK · DANIEL TE KAAT · NATALJA VON WESTERNHAGEN

Layer 1: Overview Research question and motivation. The paper asks how exchange rate movements affect the real economy and what role the banking system’s foreign-asset exposure plays in …

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Layer 1: Overview Research question and motivation: How does country-specific uncertainty explain variation in the cross-border funding of banks? Studying this link is practically relevant given …

Pasqualina Arca · Gianfranco Atzeni · Luca G. Deidda

Layer 1: Overview Research question and motivation: Under U.S. Chapter 7 bankruptcy, an individual entrepreneur has most unsecured debt discharged and only her non-exempt assets liquidated, producing …

Masami Imai · Michiru Sawada

Layer 1: Overview Research question and motivation: Why do financial crises leave such deep and protracted economic wounds, with crisis-stricken economies failing to revert to pre-crisis growth trends …

Carlo Altavilla · Refet S. Gürkaynak · Rogier Quaedvlieg

Layer 1: Overview This paper establishes basic facts about the external finance premium (EFP) faced by euro area firms borrowing from banks, and studies how monetary policy is transmitted to it. The …

Ricardo Duque Gabriel

Layer 1: Overview Research question and motivation. Public procurement accounts for roughly one-third of government spending (12.6% of GDP and 30% of total government expenditures in OECD countries in …

Marius Clemens · Stefan Gebauer · Tobias König

Layer 1: Overview Research question and motivation: The first two pillars of the European Banking Union (single supervision and single resolution) are in place, but the third pillar — a European …

Allen N. Berger · Onesime Epouhe · Raluca A. Roman

This paper examines the effects of the Troubled Asset Relief Program (TARP) and the Paycheck Protection Program (PPP)—two government bailout programs during the Global Financial Crisis and the …

Daria Finocchiaro · Philippe Weil

Research Question. Finocchiaro and Weil ask whether financial development necessarily promotes long-run economic growth, or whether congestion externalities in R&D markets can offset — and even …

Jess Benhabib · Feng Dong · Pengfei Wang · Zhenyang Xu

Layer 1 — Overview Research Question. Why do corporate defaults cluster in recurring episodes rather than occurring smoothly? The paper asks whether observable fundamental factors — firm …

Vitaly M. Bord · Agnes Kovacs · Patrick Moran

Layer 1 — Overview Research Question. Should regulators restrict banks from proactively raising credit card limits using machine-learning algorithms, and if so, how? The paper asks: to what extent are …

Cooper Howes · Gregory Weitzner

Bank Information Production Over the Business Cycle Research Question Banks produce private information about borrowers that is inherently unobservable to outside researchers. Howes and Weitzner ask …

SANG RAE KIM

This paper studies when a bank is more effective as a supplier of privately produced money-like safe assets (repo, commercial paper), finding that a bank produces safer, more liquid assets when (1) …

Elliot Anenberg · Tess Scharlemann · Eileen van Straelen

Overview Research Question. Does monetary policy stimulate household borrowing and consumption by enabling cash-out mortgage refinancing (“the cash-out refinance channel”), or does it …

Francesco Lippi · Elia Moracci

Lippi and Moracci (2026) ask how euro area households choose between cash and card payments, and whether existing theoretical models can explain observed behavior. They draw on ECB payment diary …

Francesco Giovanardi · Matthias Kaldorf

Layer 1 — Overview Research Question This paper asks two related questions about the intersection of climate policy and bank capital regulation. First, can differentiated bank capital requirements — …

Marco Cosconati · Yi Xin · Fan Wu · Yizhou Jin

This paper studies imperfect competition in selection markets where competing firms have heterogeneous information about consumers — a layer of asymmetry distinct from the classic buyer-seller …

Kristine W. Hankins · Morteza Momeni · David Sovich

Overview Research Question. Do import tariffs affect consumer credit terms, and does focusing solely on goods prices understate tariff pass-through to consumers? The paper also asks whether vertical …

Sara G Castellanos · Diego Jiménez-Hernández · Aprajit Mahajan · Eduardo Alcaraz Prous · Enrique Seira

Layer 1 — Overview Research Question This paper asks two related questions bearing on financial inclusion policy in developing countries: (1) How effective are credit card contract term changes — …

Francesco Ferrante · Nils Gornemann

Layer 1 — Overview Research Question Ferrante and Gornemann study the aggregate and redistributive effects of currency devaluations in emerging market economies, focusing on a feature that prior …

Daniel L. Greenwald · Adam Guren

Overview Research Question. To what extent did an expansion and contraction of credit drive the 2000s housing boom and bust? The existing literature offers sharply divergent answers — ranging from …

Lee K. Davison · Carlos D. Ramirez

Overview Research question. Does deposit insurance promote financial depth by arresting the outflow of deposits from the banking system during periods of bank distress? The paper tests and quantifies …

Sergio Correia · Stephan Luck · Emil Verner

Correia, Luck, and Verner ask a foundational question in banking: why do banks fail? Specifically, they seek to adjudicate between two theoretical views — the solvency view (failures caused by …

Renato Faccini · Seungcheol Lee · Ralph Luetticke · Morten O. Ravn · Tobias Renkin

Overview Research Question. How do consumer credit spreads — the gap between household borrowing rates and deposit rates — affect aggregate business cycle dynamics and the distribution of consumption …

Kirstin Hubrich · Yves S. Schüler · Daniel Waggoner

This paper investigates the role of leverage of financial institutions in amplifying the transmission of financial shocks to the macroeconomy, with particular attention to whether that amplification …

Wenhao Li · Ye Li

Crises have cleansing effects—low-quality firms face greater financial shortfalls and invest less than high-quality firms—but public credit support dampens these effects by reducing financing cost …

Emanuele Ciola · Gabriele Tedeschi

Layer 1: Overview This paper investigates how the endogenous structure of credit, deposit, and interbank networks shapes business cycle fluctuations and large financial crises in the U.S. economy. …

Markus Hertrich · Daniel Nathan

This paper uses confidential daily data on the Bank of Israel’s (BOI) foreign exchange purchase program in the USD/Israeli new shekel (ILS) spot market from 2013 to 2019 to study how FX …

EMMANUEL DE VEIRMAN · JASPER DE JONG

Layer 1 — Overview Research Question De Veirman and de Jong develop a new approach to estimating the macroeconomic effects of changes in regulatory loan-to-value (LTV) limits on mortgage loans. The …

Rodney J. Garratt · Zhentong Lu · Phoebe Tian

This paper uses detailed transaction-level data from Canada’s new high-value payment system (HVPS) to show how participants save liquidity by strategically exploiting the gridlock resolution …

Paul H S Kim · Anran Li

Kim and Li study how publicly provided reinsurance affects insurer behavior and market outcomes in health insurance markets where firms face substantial cost uncertainty. The central question is …

Chun-Che Chi

Layer 1 — Overview Research Question This paper studies how the lender structure of external debt — specifically, the degree to which a borrowing country’s external debt is concentrated among a …

Daniel Björkegren · Joshua E. Blumenstock · Samsun Knight

This paper addresses the problem of algorithmic manipulation: when consequential decisions are encoded in machine learning algorithms, individuals strategically alter their behavior to achieve desired …

GEORGE J. BRATSIOTIS · KASUN D. PATHIRAGE

This paper introduces a four-agent estimated New Keynesian DSGE model—comprising banked simple households, underbanked simple households, firm owners, and bank owners—to examine agent-specific and …

Camelia Minoiu · Rebecca Zarutskie · Andrei Zlate

Overview Research Question. Minoiu, Zarutskie, and Zlate ask whether participation in the Main Street Lending Program (MSLP)—a Federal Reserve emergency facility launched in mid-2020 to channel credit …

Paolo Gelain · Marco Lorusso

This paper estimates the effect of oil price fluctuations on US banking variables using a Bayesian SVAR with sign restrictions following Baumeister and Hamilton (2019). Oil market shocks that lead to …

Árpád Ábrahám · Eva Carceles-Poveda · Yan Liu · Ramon Marimon

Layer 1 — Overview Research Question This paper asks how to optimally design a Financial Stability Fund (Fund) for a union of sovereign countries that must simultaneously (i) prevent sovereign …

Yuteng Cheng · Ryuichiro Izumi

This paper examines how the degree of user anonymity built into a central bank digital currency (CBDC) affects bank lending decisions and what this implies for the optimal design of CBDC anonymity. …

Matthew Baron · Luc Laeven · Julien Pénasse · Yevhenii Usenko

Layer 1 — Overview Research Question This paper investigates two interrelated questions about historical banking crises: (1) whether bank losses during banking crises are primarily temporary or …

José E. Gutiérrez

This paper provides a contract-theoretic rationale for the special liquidity regulation of bank credit lines—a form of lending that has received little attention in the regulatory literature despite …

Johnny Tang

This paper quantitatively assesses the consequences of jurisdictional competition in the US life insurance industry, an $8 trillion market. The central question is whether competition between state …

ANNA GRODECKA‐MESSI · JIEYING LI · XIN ZHANG

Layer 1 — Overview Research Question This paper investigates how rising house prices affect the composition of household debt portfolios in Sweden during 2010–2014. Specifically, the authors ask …

Giulia Brancaccio · Karam Kang

Layer 1 — Overview Research Question This paper investigates whether intermediaries in the U.S. municipal bond market strategically exploit product design to increase search frictions and, through …

Ivan T Ivanov · Luke Pettit · Toni M Whited

Layer 1 — Overview Research Question Does corporate income taxation raise or lower corporate leverage? The canonical Modigliani-Miller (1963) view holds that the interest tax deduction makes debt more …

Xiaoming Li · Zheng Liu · Yuchao Peng · Zhiwei Xu

Layer 1 — Overview Research Question This paper asks how changes in the composition (not the size) of Chinese local government debt influence bank risk-taking, credit allocation between privately …

Panagiotis Avramidis · George G. Pennacchi

Using 2001-2022 annual data on U.S. commercial and savings banks matched with county-level demographic data, this paper shows that banks operating in areas with older populations—measured by the …

Raymond Kluender · Neale Mahoney · Francis Wong · Wesley Yin

Layer 1: Overview Research Question This paper asks whether relieving downstream medical debt — debt that has been sold to third-party debt collectors — causes improvements in financial outcomes, …