On Freezing Depositor Funds at Financially Distressed Banks: An Experimental Analysis

Davis, Douglas D.; Reilly, Robert J.

doi:10.1111/jmcb.12324

Cited by 26 publications

(14 citation statements)

References 34 publications

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“…Their results support the theoretical findings on the importance of information availability for depositors' behavior in bank run contexts, a core aspect in our design. Further evidence on the contextual sensitivity of financial disclosure is provided by Davis and Reilly (2016), who study the effects of different re-contracting postures taken by the banking authorities. Re-contracting conditions may either favor depositors keeping their funds in the bank or those who withdraw.…”

Section: Bank Run Experimentsmentioning

confidence: 99%

Bank Instability: Interbank Linkages and the Role of Disclosure

2020

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We study the impact of disclosure about bank fundamentals on depositors' behavior in the presence (and absence) of economic linkages between financial institutions. Using a controlled laboratory environment, we identify under which conditions disclosure is conducive to bank stability. We find that bank deposits are sensitive to perceived bank performance. While banks with strong fundamentals benefit from more precise disclosure, an opposing effect is present for solvent banks with weaker fundamentals. Depositors take information about economic linkages into account and correctly identify when disclosure about one institution conveys meaningful information for others. Our findings highlight both the costs and benefits of bank transparency and suggest that disclosure is not always stability enhancing.

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Section: Bank Run Experimentsmentioning

confidence: 99%

Bank Instability: Interbank Linkages and the Role of Disclosure

2020

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“…Hasonló eredményeket talált Madies (2006) és Kiss et al (2012). Davis -Reilly (2016) azt mutatja meg, hogy a kifizetések felfüggesztésének hatása a bankrohamok kialakulására függ attól, hogy mennyire "kemény" (tough) a bank, azaz mennyi pénzt is vehetnek fel a betétesek, ha bankpánik miatt korlátozzák a betétkivétet. Amikor a bank kemény volt, akkor kevesebb bankroham alakult ki.…”

Section: Kísérletekunclassified

A betétesek viselkedése tömeges betétkivonás idején

Hubert¹

2018

Hitelintézeti szemle

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A tanulmány empirikus és kísérleti adatok alapján áttekinti a betétesek viselkedéséről szóló szakirodalmat. Ennek alapján megállapítja, hogy fundamentális problémák és a betétesek közötti koordináció is magyarázhatja a betétesek döntését és így a tömeges betétkivonás kialakulását. Megmutatja, hogy számít a betétesek heterogenitása, az egyéni jellemzők hatása pedig függ fundamentális gondok meglététől. Azon jellemzők (végzettség, pénzügyi felkészültség, vagyon, banki tapasztalat és kapcsolat), amelyek valószínűsítik, hogy a betétes információt gyűjt a bankról, csökkentik (növelik) a tömeges betétkivonás esélyét fundamentális gondok hiányában (esetén). A társadalmi hálózatok (és a rajtuk keresztül áramló információ) hatása is számít. A betétbiztosítás csökkenti a bankrohamok (bank runs) kialakulásának bekövetkeztét, de nem képes teljesen kiküszöbölni. Az empirikus tapasztalatokkal a kísérletek is összhangban állnak.

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“…The findings of Madies (2006) and Kiss et al (2012) were similar. Davis -Reilly (2016) present that the impact of the suspension of convertibility on the development of bank runs depends on how tough the bank is, i.e. how much money the depositors can withdraw if deposit withdrawal is limited due to a bank panic.…”

Section: Studies Hubert János Kissmentioning

confidence: 99%

Depositors’ Behaviour in Times of Mass Deposit Withdrawals

Hubert¹

2018

Hitelintézeti szemle

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Based on empirical and experimental data, the study provides an overview of the literature on the behaviour of depositors. On this basis, it establishes that depositors' decisions and thus the phenomenon of mass deposit withdrawals can be explained by fundamental problems as well as coordination among depositors. It points out that depositors' heterogeneity matters, and the impact of individual characteristics depends on the existence of fundamental problems. Characteristics (such as education, financial sophistication, wealth, bank experience and connections) that make it likely that a depositor collects information on the bank reduce the chance of mass deposit withdrawal in the absence of fundamental problems, but increase the chance of mass deposit withdrawal in the case of such problems. The effect of social networks (and of the information flowing through such) also matters. Deposit insurance reduces the probability of bank runs, but is unable to eliminate them completely. Experimental findings are also in line with empirical experiences.

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On Freezing Depositor Funds at Financially Distressed Banks: An Experimental Analysis

Cited by 26 publications

References 34 publications

Bank Instability: Interbank Linkages and the Role of Disclosure

Bank Instability: Interbank Linkages and the Role of Disclosure

A betétesek viselkedése tömeges betétkivonás idején

Depositors’ Behaviour in Times of Mass Deposit Withdrawals

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