Stigma, Free-Riding, and Bank Instability

This paper presents a simple model of depositors' behavior when their bank faces a bankruptcy risk due to delinquent loans. It is shown that the delinquent loans could have a destabilizing effect, causing the depositors to avoid association with the bank and giving rise to a socially inefficient bank run. Possible remedies to such stigmatization (e. g. informational regulation, bail-out, and the formation of a group of "stable depositors") are also discussed.

経済論集

AN00071516

02874237

79

35

47

2002-03-20

英語

紀要論文

紀要論文

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