Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
7349561 | Economics Letters | 2018 | 13 Pages |
Abstract
We develop a model that estimates the joint determination of the probability of a distressed bank to go bankrupt or to be bailed out. We obtain precise parameter estimates and superior in- and out-of-sample forecasts, which demonstrate that the determinants of failures differ from those of bailouts. Overall, we provide a concrete and reliable mechanism for preventing welfare losses due to bank distress.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Nikolaos I. Papanikolaou,