Download Professor: Martín Gonzalez Eiras

Markets and Financial Intermediation
Spring 2010
Professor: Martín Gonzalez Eiras
Bibliography:
(FR) Freixas X. y J-C Rochet, “Microeconomics of Banking”, 2008, MIT Press, Second Edition
(BF) Blanchard O. y S. Fisher, “Lectures on Macroeconomics”, 1989, MIT Press
1. Financial Intermediation
Reasons for financial intermediation. Transaction costs. Iliquidity risks. Imperfect information and
monitoring. Comparative financial systems.
*FR 2.1 to 2.4
Akerlof G., “The Market for Lemons: Quality Uncertainty and the Market Mechanism”, 1970,
Quarterly Journal of Economics, Vol. 84 No 3, 488-500
Allen F. and A. Santomero, “What do financial intermediaries do?”, 2001, Journal of Banking and
Finance 25, 271-294
*Diamond D. and P. Dybvig, “Bank Runs, Deposit Insurance, and Liquidity”, 1983, Journal of
Political Economy, 91, 401-419
Kashap A., R. Rajan, y J. Stein, “Banks as Liquidity Providers: An Explanation for the Coexistence
of Lending and Deposit-Taking”, 2002, Journal of Finance, Vol 57, No, 33-73
Spence M., “Job Market Signaling”, 1973, Quarterly Journal of Economics, Vol. 87 No 3, 355-374
2. Financial system development and economic growth
International evidence, problems with reverse causality. Impact on income inequality.
*FR 5.1 to 5.3
*BF 9.6
Beck, T., R. Levine and N. Loayza, “Finance and the Sources of Growth”, 2000, Journal of
Financial Economics, 58, 261-300
Eichengreen B. and P. Luengnaruemitchai, “Why doesn’t Asia have Bigger Bond Markets?”, 2004,
NBER Working Paper 10576
Guiso L., P. Sapienza and L. Zingales, “Does Local Financial Development Matter?”, 2004,
Quarterly Journal of Economics, 119, 929-969
Laporta R., F. López de Silanes, A. Shleifer and R. Vishny, “Legal Determinants of External
Finance”, 1997, Journal of Finance, 52, 1131-1150
*Rajan R. and L. Zingales, “Financial Dependence and Growth”, 1998, American Economic
Review, 88, 559-586
Stiglitz J. and A. Weiss, “Credit Rationing in Markets with Imperfect Information”, 1981, American
Economic Review, Vol. 71 393-410
3. Effects of financial intermediation on the business cycle
The credit channel. Financial systems fragility. Kiyotaki-Moore credit cycles model.
*FR 6.3,6.4 and 6.6
*Bernanke B. and M. Gertler, “Financial Fragility and Economic Performance”, 1990, Quarterly
Journal of Economics, 105, 87-114
*Kashyap, Anil K and Jeremy C. Stein, “What Do a Million Observations on Banks Say About the
Transmission of Monetary Policy?”, American Economic Review, Volume 90, N° 3, June 2000,
407-428
*Kiyotaki N. and J. Moore, “Credit Cycles”, 1997, Journal of Political Economy, 76, 47-71
*Kurlat P., “Lemons, Market Shutdowns and Learning”, 2010, mimeo MIT
Kocherlakota N., “Creating Business Cycles Through Credit Constraints”, 2000, Federal Reserve
Bank of Minneapolis Quarterly Review, Summer, 2-10
*Matsuyama, K., “Financial Market Globalization, Symmetry-Breaking and Endogenous Inequality
of Nations”, 2004, Econometrica, Vol. 72, N° 3, 853-884
4. Liquidity problems and bank runs
Deposit insurance. Bank runs. Role of asset markets in the event of a crisis. Interbank markets.
*FR 7.1 to 7.5, 9.1 and 9.2
*Allen F. and D. Gale, “Financial Intermediaries and Markets”, 2004, Econometrica Vol 72, 10231062
Crystal, Jennifer, B. Gerard Dages, and Linda Goldberg (2001), “Does Foreign Ownership
Contribute to Sounder Banks in Emerging Markets? The Latin American Experience,” Federal
Reserve Bank of New York Staff Report #137, September.
Dages, B. Gerard, Linda Goldberg, and Daniel Kinney (2000), “Foreign and Domestic Bank
Participation in Emerging Markets: Lessons from Mexico and Argentina,” Economic Policy
Review, Federal Reserve Bank of New York, September, 17-36.
*Ennis H. and T. Keister, “Bank Runs and Institutions: The Perils of Intervention?”, American
Economic Review, Volume 99, Number 4, September 2009 , 1588-1607
5. Lender of Last Resort.
Impact on financial systems’ stability. Restrictions in emerging economies. International evidence.
*FR 7.7
Bordo M., “The Lender of Last Resort: Alternative views and historical experience”, 1986, Federal
Reserve Bank of Richmond Economic Review 76, 18-29
Broda, C. and E. Levy-Yeyati, “Dollarization and the Lender of Last Resort”, 2000, mimeo New
York Fed
Caballero R. and A. Krishnamurthy, “Flight to Quality and Central Bank Interventions, mimeo
April 2005
Demirque-Kunt, Asli and Enrica Detragiache, “The Determinants of Banking Crises in Developing
and Developed Countries,” 1998, IMF Staff Papers, Vol. 45, No. 1, 81-105
*Gonzalez-Eiras, M., “Banks’ Liquidity Demand in the Presence of a Lender of Last Resort”, 2004,
mimeo Universidad de San Andrés
Freixas X., M. Parigi, and J. Rochet, “The Lender of Last Resort: A 21st Century Approach”, 2003,
ECB Working Paper No 298
*Miron J., “Financial Panics, the seasonality of the nominal interest rate, and the founding of the
Fed”, 1986, American Economic Review 76, 125-40
*Rochet J. and X. Vives, “Coordination Failures and the Lender of Last Resort: Was Bagehot Right
after all?”, Journal of the European Economic Association, Vol 2, No 6, 1116-1147