Johan Hombert, Bruno Biais , Pierre-Olivier Weill Mar 29,2021
Incentive problems make securities’ payoffs imperfectly pledgeable, limiting agents’ ability to issue liabilities. We analyze the equilibrium consequences of such... Read More
Ana Babus , Cecilia Parlatore Apr 30,20210
We study the determinants of asset market fragmentation in a model with strategic investors that disagree about the value of... Read More
Christian Opp Vincent Glode Apr 30,2021
We propose a model of strategic debt renegotiation in which businesses are sequentially interconnected through their liabilities. This financing structure,... Read More
Basil Williams , Yaron Leitner Aug 29,2020
We study whether regulators should reveal the models they use to stress test banks. In our setting, revealing leads to... Read More
Ivan Marinovic , Martin Szydlowski Sep 22,2020
We study the disclosure policy of a regulator overseeing a monitor with reputation concerns, such as a bank or... Read More
Efstathios Avdis Oct 08,2020
Long-held intuition dictates that information-based trade is impossible without exogenous noise. Risk seekers can resolve this conundrum. Even though such... Read More
Thierry Foucault,Peter Hoffmann, Jean-Edouard Colliard Oct 08,2020
We propose a new model of trading in OTC markets. Dealers accumulate inventories by trading with end-investors and trade among... Read More
Gabrielle Demange, Jean-Edouard Colliard Oct 08,2020
In over-the-counter markets for assets such as bonds or securitizations, large volumes can be split into smaller pieces and gradually... Read More
Denis Gromb , Jean-Edouard Colliard Oct 08,2020
How do resolution frameworks affect the private restructuring of distressed banks? We model a distressed bank's shareholders and creditors negotiating... Read More
Stefan Nagel,Zhaogang Song, Zhiguo He Nov 07,2020
In sharp contrast to most previous crisis episodes, the Treasury market experienced severe stress and illiquidity during the COVID-19 crisis,... Read More