The top documents tagged [model of moral hazard]

Banking and Bank Runs We are going to learn a bit about what a bank does and why it leads to the possibility of bank runs. –We will start out today with.

TESTING FOR MORAL HAZARD IN FINANCIAL NETWORKS

Diamond Dybvig Model (1983) Captures elements of what a bank does. Shows that there is a basic problem of bank runs. The model consists of two parties.

Banking and Bank Runs We are going to learn a bit about what a bank does and why it leads to the possibility of bank runs. –We will start out today with.