Capital Requirements and Business Cycles with Credit Market Imperfections

The business cycle effects of bank capital regulatory regimes are examined in a New Keynesian model with credit market imperfections and a cost channel of monetary policy. Key features of the model are that bank capital increases incentives for ban...

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Bibliographic Details
Main Authors:	Agénor, P.-R., Alper, K., Pereira da Silva, L.
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNTING ACCOUNTING PRINCIPLES ADVERSE SELECTION AGGREGATE DEMAND AGGREGATE SUPPLY AMOUNT OF LOANS ARBITRAGE ASSET PRICE ASSET PRICES ASSET QUALITY ASYMMETRIC INFORMATION BALANCE SHEET BANK BEHAVIOR BANK BORROWING BANK CAPITAL BANK COMPETITION BANK DEBT BANK DEPOSITS BANK EQUITY BANK LENDING BANK LIQUIDATION BANK LIQUIDITY BANK LOANS BANK MONITORING BANK OF CANADA BANK OF ENGLAND BANK OF SPAIN BANK POLICY BANK PROFITS BANK REGULATION BANKS BANQUE DE FRANCE BOND BORROWER BORROWING COSTS BUDGET CONSTRAINT BUSINESS CYCLE BUSINESS CYCLES CAPITAL ACCUMULATION CAPITAL ADEQUACY CAPITAL GAINS CAPITAL NEEDS CAPITAL REGULATION CAPITAL REQUIREMENT CAPITAL REQUIREMENTS CASH BALANCES CASH FLOWS CASH HOLDINGS CASH MARKETS CENTRAL BANK CENTRAL BANKING CLOSED ECONOMY COLLATERAL COMMERCIAL BANK COMPARATIVE ECONOMICS COMPETITIVE MARKET CONTRACT ENFORCEMENT COST OF CAPITAL COST OF FUNDS CREDIT CRUNCHES CREDIT MARKET CREDIT MARKETS CURRENCY DEBT DEBT RATIO DEFAULT PROBABILITY DEFAULT RISK DEMAND FOR BONDS DEMAND FOR CAPITAL DEMAND FOR CREDIT DEPOSIT DEPOSIT RATE DEPOSITORS DEPOSITS DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DISCOUNTED VALUE DIVIDEND DIVIDENDS ECONOMIC ACTIVITY ECONOMIC FLUCTUATIONS ELASTICITY ELASTICITY OF DEMAND ELASTICITY OF SUBSTITUTION ENDOGENOUS VARIABLES EQUILIBRIUM EQUITY CAPITAL EQUITY HOLDINGS EQUITY MARKET EQUITY PRICE EXPECTED RETURN EXPOSURE EXTERNAL SHOCKS FINANCIAL ASSETS FINANCIAL CRISIS FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL MARKET FINANCIAL SAFETY FINANCIAL SAFETY NETS FINANCIAL SECTOR FINANCIAL STABILITY FINANCIAL STRUCTURE FINANCIAL SYSTEM GOVERNMENT BONDS GOVERNMENT SPENDING GROWTH RATE HOLDING HOLDINGS OF BANK HOUSEHOLD DEPOSITS HOUSEHOLDS HOUSING INDIRECT COST INDUSTRIAL ECONOMIES INFLATION INFLATION RATE INTEREST INCOME INTEREST PAYMENTS INTEREST RATE INTEREST RATES INTERNATIONAL BANK LABOR COSTS LABOR HOURS LENDERS LIMITED LIABILITY LOAN LOAN APPLICANTS LOAN CONTRACT LOAN DEFAULT LOAN PORTFOLIO LOAN PORTFOLIOS LOAN RATE LOAN RATES LOANABLE FUNDS MACROECONOMICS MARGINAL COST MARGINAL COSTS MARGINAL PRODUCT MARGINAL PRODUCTIVITY MARGINAL UTILITY MARGINAL UTILITY OF CONSUMPTION MARK-TO-MARKET MARKET PRICING MARKET RISKS MATURITY MATURITY PERIOD MIDDLE-INCOME COUNTRIES MIDDLE-INCOME COUNTRY MONETARY ASSET MONETARY ASSETS MONETARY FUND MONETARY POLICY MONETARY SHOCKS MONEY SUPPLY MORAL HAZARD MORTGAGE MORTGAGE LENDING MORTGAGE MARKET NEGATIVE SHOCK NET WORTH NOMINAL PRICES NOMINAL YIELD NONPERFORMING LOANS OPEN ECONOMIES OPEN-MARKET OPERATIONS OPPORTUNITY COST OPTIMIZATION OUTPUT OUTPUT GAP OUTSTANDING AMOUNT OUTSTANDING LOANS OUTSTANDING STOCK PARTIAL EQUILIBRIUM ANALYSIS PERISHABLE GOOD PHILLIPS CURVE PHYSICAL ASSETS PHYSICAL CAPITAL POLICY RESPONSE POOL OF BORROWERS PORTFOLIO ALLOCATION POSSIBILITY OF DEFAULT PROBABILITY OF DEFAULT PROBABILITY OF REPAYMENT PRODUCTION COSTS PRODUCTION FUNCTION PRODUCTIVITY PROFITABILITY PRUDENTIAL REGULATION PRUDENTIAL SUPERVISION PUBLIC SPENDING RATE OF RETURN RATES OF RETURN REAL INTEREST REAL INTEREST RATE RECESSION RECESSIONS REDEMPTION REGULATORY CAPITAL REGULATORY REGIME REGULATORY REGIMES REGULATORY SCRUTINY REPAYMENT RESERVE RESERVE REQUIREMENT RESERVE REQUIREMENTS RESERVES RETAINED EARNINGS RETURN RETURN ON EQUITY RETURNS RISK OF DEFAULT RISK OF LOAN RISK PREMIUM RISK TAKING RISK WEIGHT RISK WEIGHTS RISKY ASSET SCALE EFFECT SECURITIES SHARE OF EQUITY SHARE PRICE SHAREHOLDERS STOCKS SUPPLY OF CREDIT TAX TAX REVENUES TRANSACTIONS COSTS TRANSITION ECONOMIES VALUE OF COLLATERAL WAGES WEALTH WORKING CAPITAL
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091209152140 http://hdl.handle.net/10986/4344

Internet

http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091209152140
http://hdl.handle.net/10986/4344

Capital Requirements and Business Cycles with Credit Market Imperfections

Internet

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