Are Bank Bailouts Welfare Improving?

• Author(s) / Creator(s)

  • Shukayev, Malik

• SSHRC IDG awarded 2019: This project aims to examine if publicly funded bailouts of financial institutions during banking crises are welfare beneficial, once their longer term impact on risk taking and on the crisis probability is taken in account.The specific objectives of the research are: a) to develop a general equilibrium model which allows a quantitative assessment of the welfare costs and benefits of publicly funded bailouts of financial institutions during widespread banking panics; b)to evaluate quantitatively the role that various monetary policy and financial regulation regimes play in alleviating the need for emergency bailout procedures during crisis; c) to characterize the optimal financial rescue strategy admitting systematic responses, yet with some intentionally randomized eligibility criteria in bailout procedures. We are planning to adapt an extended and re-calibrated version of the model in Shukayev and Ueberfeldt (2018) to analyze the welfare implications of bank bailouts.

• Date created

  2019-02-01

• Subjects / Keywords

  • IDG
  • Insight Development Grant
  • SSHRC
  • Financial Instability
  • Banking Crisis
  • Bailout of Financial Institutions
  • Systemically Important Financial Institutions
  • Government Sponsored Bank Mergers
  • Moral Hazard
  • Economics
  • Management
  • Business
  • Administrative Studies
  • Financial Systems
  • Monetary Systems
  • Politics
  • Government
  • 1960AD-2019AD
  • North America
  • Europe
  • Canada
  • United States
  • Switzerland

• Type of Item

  Research Material

• DOI

  https://doi.org/10.7939/r3-a34c-z153

• License

  ©️Shukayev, Malik. All rights reserved other than by permission. This document embargoed to those without UAlberta CCID until 2024.