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A game of bank resolution

Author

Listed:
  • Gabriel MITRACHE

    (Bucharest Academy of Economic Studies, Romania)

Abstract

Before the 2008 financial crisis, credit institutions were aware that if they were large enough they would be rescued with tax-payers’ money, an action also known as bail-out, what became known as “too big to fail”. The BRRD proposes a legal framework that aims at eliminating the possibility of bailing-out credit institutions. This paper has the objective of assessing through a game theory analysis to what extent the BRRD has the potential to achieve its purpose and if there are identifiable improvements to this framework that could be considered for practical purposes or for a possible review of the framework.

Suggested Citation

  • Gabriel MITRACHE, 2018. "A game of bank resolution," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(Special), pages 209-217.
    • Handle: RePEc:agr:journl:v:xxv:y:2018:i:special:p:209-217
    as

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    References listed on IDEAS

    as
    1. Dirk Schoenmaker, 2017. "A macro approach to international bank resolution," Policy Contributions 21231, Bruegel.
    2. Benjamin Bernard & Agostino Capponi & Joseph E. Stiglitz, 2022. "Bail-Ins and Bailouts: Incentives, Connectivity, and Systemic Stability," Journal of Political Economy, University of Chicago Press, vol. 130(7), pages 1805-1859.
    3. Stephan Kohns, 2017. "Monetary Policy and Financial Stability," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 15(01), pages 17-18, April.
    4. Stephan Kohns, 2017. "Monetary Policy and Financial Stability," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 15(1), pages 17-18, 04.
    5. repec:ces:ifodic:v:15:y:2017:i:1:p:19307486 is not listed on IDEAS
    6. DeYoung, Robert & Kowalik, Michal & Reidhill, Jack, 2013. "A theory of failed bank resolution: Technological change and political economics," Journal of Financial Stability, Elsevier, vol. 9(4), pages 612-627.
    Full references (including those not matched with items on IDEAS)

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