Deposit Competition and Financial Fragility: Evidence from the US Banking Sector

We develop a structural empirical model of the US banking sector. Insured depositors and run-prone uninsured depositors choose between differentiated banks. Banks compete for deposits and endogenously default. The estimated demand for uninsured deposits declines with banks' financial distress,...

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Bibliographic Details
Published in:The American economic review 2017-01, Vol.107 (1), p.169-216
Main Authors: Egan, Mark, Hortaçsu, Ali, Matvos, Gregor
Format: Article
Language:English
Subjects:
Analysis
Bank capital
Bank markets
Banking
Banking industry
Banking law
Banking services
Banking system
Banks
Calibration
Capital
Capital requirements
Commercial banks
Competition
Default insurance
Deposit insurance
Economic models
Economics
Elasticity
Equilibrium
Expected utility
Feedback
Insurance rates
Market shares
Microeconomics
Money markets
Political economy
Psychological distress
Regulation of financial institutions
Retail banking
Studies
Uninsured people
United States
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