When there were almost no flats in Halle yet ... Brigitte Loose about IWH's...
IWH-CompNet Discussion Papers
IWH-CompNet Discussion Papers The IWH-CompNet Discussion Paper series presents research...
Fiscal Policy and Fiscal Fragility: Empirical Evidence from the OECD ...
Does Machine Learning Help us Predict Banking Crises? ...
Joint Economic Forecast
Joint Economic Forecast The joint economic forecast is an instrument for evaluating...
Avoiding the Fall into the Loop: Isolating the Transmission of Bank-to-Sovereign Distress in the Euro Area and its Drivers
IWH Discussion Papers,
We isolate the direct bank-to-sovereign distress channel within the eurozone’s sovereign-bank-loop by exploiting the global, non-eurozone related variation in stock prices. We instrument banking sector stock returns in the eurozone with exposure-weighted stock market returns from non-eurozone countries and take further precautions to remove any eurozone crisis-related variation. We find that the transmission of instrumented bank distress, while economically relevant, is significantly smaller than the corresponding coefficient in the unadjusted OLS framework, confirming concerns on reverse causality and omitted variables in previous studies. Furthermore, we show that the spillover of bank distress is significantly stronger for countries with poorer macroeconomic performances, weaker financial sectors and financial regulation and during times of elevated political uncertainty.
27.09.2018 • 18/2018
Joint Economic Forecast Autumn 2018: Upturn Loses Momentum
Berlin, 27 September – Germany’s leading economics research institutes have downwardly revised their forecasts for 2018 and 2019. They now expect economic output to increase by 1.7 percent in 2018, and not 2.2 percent as forecast in spring. They also scaled back their 2019 forecast slightly from 2.0 to 1.9 percent. These are the results of the Joint Economic Forecast for autumn 2018 that will be presented in Berlin on Thursday.
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Kommentar: Mit bester Absicht in die Krise
Wirtschaft im Wandel,
Zehn Jahre nach der Lehman-Pleite werden die Finanzmärkte besser kontrolliert denn je. Das kann böse Folgen haben.
Banks Fearing the Drought? Liquidity Hoarding as a Response to Idiosyncratic Interbank Funding Dry-ups
IWH Discussion Papers,
Since the global financial crisis, economic literature has highlighted banks’ inclination to bolster up their liquid asset positions once the aggregate interbank funding market experiences a dry-up. To this regard, we show that liquidity hoarding and its detrimental effects on credit can also be triggered by idiosyncratic, i.e. bankspecific, interbank funding shocks with implications for monetary policy. Combining a unique data set of the Brazilian banking sector with a novel identification strategy enables us to overcome previous limitations for studying this phenomenon as a bankspecific event. This strategy further helps us to analyse how disruptions in the bank headquarters’ interbank market can lead to liquidity and lending adjustments at the regional bank branch level. From the perspective of the policy maker, understanding this market-to-market spillover effect is important as local bank branch markets are characterised by market concentration and relationship lending.