Series: IMF Working Papers
Author(s): Itai Agur
Publisher: INTERNATIONAL MONETARY FUND
Publication Date: 02 July 2014
Keywords: Bank risk, Wholesale funding, Adverse selection, Multiple equilibria, banking, systemic risk, bank exposures, bank funding,
The global financial crisis highlighted that the financial system can be most vulnerable when it seems most stable. This paper models non-linear dynamics in banking. Small shocks can lead from an equilibrium with f...