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Oct 26, 2023 · Key Takeaways. The 2007-2008 financial crisis was caused by a confluence of many factors, including the Dotcom bubble burst, a low interest rate environment, financial products such as...
In the innumerable discussions and debates about Asia’s financial turmoil, typically dated from the collapse of the Thai baht on July 2, 1997, the standard script includes an acknowledgment of a phe-nomenon called “moral hazard” (hereafter referred to as MH).
Nov 1, 2014 · We find that generous financial safety nets increase bank risk and systemic fragility in the years leading up to the global financial crisis. However, during the crisis, bank risk is lower and systemic stability is greater in countries with deposit insurance coverage.
- Deniz Anginer, Asli Demirguc-Kunt, Min Zhu
- 2012
There is also considerable consensus in the literature that deposit insurance exacerbates moral hazard problems in the banking sector by incentivizing banks to take on excessive risk. Depositors can limit bank risk taking by charging higher interest rates. When deposits are
Feb 23, 2016 · The case study examines five crucial dimensions of the 2007–2009 financial crisis in the United States: (1) the devastating effects of the financial crisis on the U.S. economy; (2) the multiple causes of the financial crisis and panic; (3) the extraordinary efforts of government regulatory agencies to stem the financial freefall triggered by ...
- Edward J. Schoen
- schoen@rowan.edu
- 2017
Sep 21, 2023 · Concerns about the risk-boosting effects of moral hazard are not limited to the financial realm. They show up any time that governments offer any form of “safety net” to firms or individuals, including social supports like health insurance, unemployment benefits, or sickness benefits.
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Jan 16, 2019 · Using evidence from fixed-effects and instrumental-variable models, we find that increasing the number of US troops by one standard deviation above the mean raises the probability of a financial crisis in the host country by up to 13 percentage points. We also investigate the channels through which moral hazard materializes.
