| Article ID | Journal | Published Year | Pages | File Type |
|---|---|---|---|---|
| 5059531 | Economics Letters | 2013 | 4 Pages |
Abstract
Why do people choose bank deposit contracts over a direct participation in asset markets? In their seminal paper, Diamond and Dybvig's (1983) answer this question by claiming that bank deposit contracts can implement allocations that are welfare superior to asset markets equilibria. The present paper demonstrates that this claim is false whenever the asset market participants are highly rational.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Alexander Zimper,