Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/152793
Authors: 
Linzert, Tobias
Nautz, Dieter
Bindseil, Ulrich
Year of Publication: 
2004
Series/Report no.: 
ECB Working Paper 359
Abstract: 
This paper employs individual bidding data to analyze the empirical performance of the longer term re?nancing operations (LTROs) of the European Central Bank (ECB). We investigate how banks’ bidding behavior is related to a series of exogenous variables such as collateral costs, interest rate expectations, market volatility and to individual bank characteristics like country of origin, size and experience. Panel regressions reveal that a bank’s bidding depends on bank characteristics. Yet, different bidding behavior generally does not translate into differences concerning bidder success. In contrast to the ECB’s main re?nancing operations, we ?nd evidence for the winner’s curse effect in LTROs. Our results indicate that LTROs do neither lead to market distortions nor to unfair auction outcomes.
Subjects: 
Auctions
Monetary Policy Instruments ECB
Winner’s Curse
JEL: 
E52
D44
Document Type: 
Working Paper

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