Dr. Carola Müller

Dr. Carola Müller
Aktuelle Position

seit 6/19

Research Affiliate

Leibniz-Institut für Wirtschaftsforschung Halle (IWH)

seit 9/20

Senior Economist

CEMLA

Forschungsschwerpunkte

  • Bankenregulierung
  • Finanzintermediation
  • Bankenwettbewerb

Carola Müller ist seit Juni 2019 Research Affiliate am IWH. Sie befasst sich mit den Themen Bankenregulierung und Bankenwettbewerb.

Carola Müller forscht seit September 2020 am Center for Latin American Monetary Studies (CEMLA). Zuvor war sie Doktorandin am IWH sowie Gastforscherin bei der Deutschen Bundesbank und der Norges Bank. Sie studierte an der Georg-August-Universität Göttingen.

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Dr. Carola Müller
Dr. Carola Müller
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Publikationen

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Market Power and Risk: Evidence from the U.S. Mortgage Market

Carola Müller Felix Noth

in: Economics Letters, 2018

Abstract

We use mortgage loan application data of the Home Mortgage Disclosure Act (HMDA) to shed light on the role of banks’ market power on their presumably insufficient risk screening activities in the U.S. mortgage market in the pre-crisis era. We find that banks with higher market power protect their charter value. The effect is stronger for banks that have more information about local markets.

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Arbeitspapiere

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Capital Requirements, Market Structure, and Heterogeneous Banks

Carola Müller

in: IWH Discussion Papers, Nr. 15, 2022

Abstract

Bank regulators interfere with the efficient allocation of resources for the sake of financial stability. Based on this trade-off, I compare how different capital requirements affect default probabilities and the allocation of market shares across heterogeneous banks. In the model, banks‘ productivity determines their optimal strategy in oligopolistic markets. Higher productivity gives banks higher profit margins that lower their default risk. Hence, capital requirements indirectly aiming at high-productivity banks are less effective. They also bear a distortionary cost: Because incumbents increase interest rates, new entrants with low productivity are attracted and thus average productivity in the banking market decreases.

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May the Force Be with You: Exit Barriers, Governance Shocks, and Profitability Sclerosis in Banking

Michael Koetter Carola Müller Felix Noth Benedikt Fritz

in: Deutsche Bundesbank Discussion Paper, Nr. 49, 2018

Abstract

We test whether limited market discipline imposes exit barriers and poor profitability in banking. We exploit an exogenous shock to the governance of government-owned banks: the unification of counties. County mergers lead to enforced government-owned bank mergers. We compare forced to voluntary bank exits and show that the former cause better bank profitability and efficiency at the expense of riskier financial profiles. Regarding real effects, firms exposed to forced bank mergers borrow more at lower cost, increase investment, and exhibit higher employment. Thus, reduced exit frictions in banking seem to unleash the economic potential of both banks and firms.

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