03271nam 2200625 a 450 991080887280332120200520144314.01-4623-4561-11-4527-9946-61-283-56128-X97866138737361-4519-2028-8(CKB)3360000000445091(EBL)3012511(SSID)ssj0001478958(PQKBManifestationID)11781068(PQKBTitleCode)TC0001478958(PQKBWorkID)11471926(PQKB)11741419(OCoLC)535146898(IMF)WPIEE2352004(MiAaPQ)EBC3012511(EXLCZ)99336000000044509120090807d2004 uy 0engur|n|---|||||txtccrManaging confidence in emerging market bank runs /prepared by Se-Jik Kim and Ashoka Mody1st ed.[Washington, D.C.] International Monetary Fund, European Dept., and Research Dept.20041 online resource (29 p.)IMF working paper ;WP/04/235"December 2004."1-4518-7568-1 Includes bibliographical references (p. 27-28).""Contents""; ""I. INTRODUCTION""; ""II. THE BASIC MODEL""; ""III. SIMULTANEOUS VERSUS SEQUENTIAL LIQUIDITY SHORTAGES""; ""IV. EARLY VERSUS LATE BAILOUTS""; ""V. POLITICAL ECONOMY""; ""VI. EXTENSIONS""; ""VII. CONCLUSIONS""; ""References""In a rational-expectations framework, we model depositors' confidence as a function of the probability of future bank bailouts. We analyze the effect of alternative bank bailout policies on depositors' confidence in an emerging market setting, where liquidity shortages of banks are revealed sequentially and governments cannot credibly commit to bailing out all potentially distressed banks. Our findings suggest that allowing early bank failures and using available liquidity for credible commitments to later bailouts can better boost confidence than early bailouts. This conclusion arises because with a high chance of liquidity shortage in the future, depositors may lose confidence and hence withdraw deposits even from potentially sound banks. Such a policy of late bailouts is likely to receive political support when a full bailout needs to be financed by taxation. The logic of late bailout remains valid even when banks may hide their distress or when closures of early distressed banks create contagion.IMF working paper ;WP/04/235.Bank failuresDeveloping countriesEconometric modelsLiquidity (Economics)Developing countriesEconometric modelsBank failuresEconometric models.Liquidity (Economics)Econometric models.Kim Se-Jik1960-1623190Mody Ashoka888386International Monetary Fund.European Dept.International Monetary Fund.Research Dept.MiAaPQMiAaPQMiAaPQBOOK9910808872803321Managing Confidence in Emerging Market Bank Runs3986698UNINA