Article ID Journal Published Year Pages File Type
967484 Journal of Monetary Economics 2011 12 Pages PDF
Abstract
► Precautionary demand for liquidity can explain extreme inter-bank lending rates. ► Banks' borrowing levels are determined by lending banks' leverage and rollover risk. ► Market failure can lead to a complete freeze in the inter-bank market.
Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
Preview
A model of liquidity hoarding and term premia in inter-bank markets
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