Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/22849 
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dc.contributor.authorDrehmann, Mathiasen
dc.date.accessioned2009-01-29T15:10:21Z-
dc.date.available2009-01-29T15:10:21Z-
dc.date.issued2002-
dc.identifier.urihttp://hdl.handle.net/10419/22849-
dc.description.abstractIn this paper we show that deposit insurance can increase the probability of systemic banking crisis, even though it is optimally designed and its premium is risk related. This is driven by the possibility of contagious bank runs. We prove that contagion only occurs if the correlation between the portfolios of banks is high enough. Without deposit insurance contagious bank runs can impose such great losses on banks, that banks choose less correlated portfolios to avoid contagion altogether. Optimal deposit insurance eliminates this incentive and thus the correlation of portfolios and with it the probability of systemic banking crisis can increase.en
dc.language.isoengen
dc.publisher|aUniversity of Bonn, Bonn Graduate School of Economics (BGSE) |cBonnen
dc.relation.ispartofseries|aBonn Econ Discussion Papers |x28/2002en
dc.subject.jelG28en
dc.subject.jelG21en
dc.subject.ddc330en
dc.subject.keywordBank runsen
dc.subject.keywordcontagionen
dc.subject.keywordsystemic risken
dc.subject.keywordinvestment of banksen
dc.subject.keyworddeposit insuranceen
dc.subject.stwEinlagensicherungen
dc.subject.stwBankenkriseen
dc.subject.stwBankrisikoen
dc.subject.stwBilanzstrukturmanagementen
dc.subject.stwKorrelationen
dc.subject.stwTheorieen
dc.titleWill an optimal deposit insurance always increase financial stability?-
dc.typeWorking Paperen
dc.identifier.ppn374452083en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen
dc.identifier.repecRePEc:zbw:bonedp:282002-

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