RESEARCH
Inequality and Financial Fragility Journal of Monetary Economics, Vol. 115 (2020)
The distribution of wealth influences the government’s response to systemic banking crises and shapes financial fragility.
Allocating Losses: Bail-ins, Bailouts and Bank Regulation Journal of Economic Theory, Vol. 210 (2023)
with Todd Keister
We study the interaction between a government's bailout policy and banks' willingness to impose losses on (or "bail-in") their investors.
A Theory of Debt Maturity and Innovation Journal of Economic Theory, Vol. 2018 (2024)
I propose a theory of debt maturity as an incentive device to motivate innovation when contracts are incomplete and shaped by ex-post renegotiation.
Private Sunspots in Games of Coordinated Attack Forthcoming Theoretical Economics
I propose a new approach to endogenizing the probability of a self-fulfilling outcome in games of coordination.
Unequal and Unstable: Income Inequality and Bank Risk R&R Journal of Money, Credit and Banking
with Ulrich Schüwer
We investigate a new channel through which income inequality shapes bank risk: risk-shifting.
When does overlapping ownership soften competition? The role of agency frictions and repeated interaction [Slides, Video]
with Konrad Adler
Tacit collusion among firms is not necessarily easier when firms are owned by the same investor. Going from separate to common ownership actually sometimes has a pro-competitive effect.
with Alkis Georgiadis-Harris and Maxi Guennewig
Since Diamond and Dybvig (1983), banks have been viewed as inherently fragile. We challenge this view in a general mechanism design framework with limited commitment.
Borrower Heterogeneity and Bank Risk
with Ulrich Schüwer
We use tools from survival analysis to study bank failure risk in a model with imperfect correlation in loan defaults where borrower credit worth depends on a systematic risk factor and idiosyncratic frailty factors.
Limited commitment, bank bailouts, and run risk: a sunspot-based approach [Slides]
I show how to use the sunspot-based approach to investigate the interplay between limited commitment, bank bailouts, and endogenous run risk in a canonical model of financial intermediation.
Optimal Banking Arrangements: Liquidity Creation without Financial Fragility [Slides]
with Maxi Guennewig
We revisit the Diamond-Rajan model of financial intermediation and show that a bank with an optimal financing structure is not subject to runs. Fragility is not inevitable for liquidity creation.
WORK IN PROGRESS
Partial Deposits (with Todd Keister)
The Bail-in Game (with Todd Keister)
Anticompetitive Effects of Loan Covenants (with Konrad Adler)