Cyclical Effects of Bank Capital Requirements with Imperfect Credit Markets

This paper analyzes the cyclical effects of bank capital requirements in a simple model with credit market imperfections. Lending rates are set as a premium over the cost of borrowing from the central bank, with the premium itself depending on firm...

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Bibliographic Details
Main Authors:	Agénor, Pierre-Richard, Pereira da Silva, Luiz A.
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCELERATOR ACCELERATOR EFFECT ACCOUNTING ADVERSE CONSEQUENCES ADVERSE EFFECT ADVERSE SHOCKS AGGREGATE DEMAND AGGREGATE SUPPLY ALTERNATIVE FUNDING ALTERNATIVE REGIMES AMOUNT OF LOANS ARBITRAGE ASSET PRICES ASSET QUALITY ASYMMETRIC INFORMATION BACKED SECURITIES BAD CREDIT BALANCE SHEET BALANCE SHEETS BALANCE-SHEET BANK ASSET BANK ASSETS BANK BEHAVIOR BANK CAPITAL BANK CREDIT BANK DEBT BANK DEPOSIT BANK DEPOSITS BANK FOR INTERNATIONAL SETTLEMENTS BANK LENDING BANK LIQUIDITY BANK LOANS BANK OF CANADA BANK OF ENGLAND BANK REGULATION BANK REGULATIONS BANKRUPTCY BANKS BILL BILLS BONDS BOOK VALUE BORROWER BORROWING BORROWING COSTS BUFFER BUFFERS BUSINESS CYCLE CAPITAL ACCUMULATION CAPITAL ADEQUACY CAPITAL BASE CAPITAL LOANS CAPITAL MARKETS CAPITAL REGULATION CAPITAL REQUIREMENT CAPITAL REQUIREMENTS CAPITAL STANDARDS CAPITAL STOCK CENTRAL BANK CENTRAL BANKING CLARITY COLLATERAL COMMERCIAL BANK COMMERCIAL BANK ASSETS COMMERCIAL BANKS COMMERCIAL PAPER CONSUMPTION EXPENDITURE CONTRACT ENFORCEMENT CORPORATE BONDS CREDIT CRUNCH CREDIT MARKET CREDIT MARKETS CREDIT RATIONING CREDIT RISKS CREDITS CURRENCY DEBT DEBT CONTRACTS DEBT INSTRUMENTS DEBTS DEFAULT RISK DEMAND FOR CREDIT DEPOSIT GUARANTEES DEPOSIT INSURANCE DEPOSITORS DEPOSITS DERIVATIVE DERIVATIVES DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DEVELOPMENT MACROECONOMICS DISPOSABLE INCOME DISTORTIONS DOMESTIC GOOD DOWNWARD PRESSURE ECONOMIC ACTIVITY ECONOMIC ENVIRONMENT ECONOMIC POLICY ELASTICITY ELASTICITY OF OUTPUT EMPLOYMENT EQUILIBRIUM EQUILIBRIUM CONDITION EQUILIBRIUM CONDITIONS EQUITY CAPITAL EXCESS DEMAND EXCESS SUPPLY EXOGENOUS SHOCK EXOGENOUS SHOCKS EXPENDITURE EXTERNAL FINANCE FINANCIAL CRISIS FINANCIAL FRAGILITIES FINANCIAL INSTITUTIONS FINANCIAL INTERMEDIATION FINANCIAL MARKET FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL STABILITY FINANCIAL SYSTEM FINANCIAL SYSTEMS FUNDING SOURCES GENERAL EQUILIBRIUM GENERAL EQUILIBRIUM ANALYSIS GROWTH RATE HOLDING HOMOGENEOUS GOOD HOUSEHOLD DEPOSITS HOUSEHOLD WEALTH HOUSEHOLDS HOUSING ID IMPACT ON PRICES INADEQUATE DISCLOSURE INCOME EFFECT INDEXATION INFLATION INFLATION RATE INTEREST PAYMENTS INTEREST RATE INTEREST RATES INTERNATIONAL BANK INVESTMENT PURPOSES LABOR COSTS LEGAL SYSTEM LEVEL OF INVESTMENT LEVERAGE LIABILITY LIABILITY MANAGEMENT LIQUIDITY CONSTRAINTS LOAN LOAN DEFAULT LOAN DEMAND MACROECONOMIC EFFECTS MACROECONOMIC MODEL MACROECONOMICS MARGINAL COST MARKET DISCIPLINE MARKET EQUILIBRIUM MARKET RATES MONETARY AUTHORITY MONETARY ECONOMICS MONETARY SHOCKS MONETARY TRANSMISSION MORAL HAZARD MORTGAGE MORTGAGE MARKET MORTGAGE-BACKED SECURITIES MORTGAGES NEGATIVE SUPPLY SHOCK NET WORTH NOMINAL WAGE OPEN ECONOMIES OPPORTUNITY COST PENALTIES PHYSICAL CAPITAL PLEDGE COLLATERAL PORTFOLIOS POSSIBILITY OF DEFAULT PRICE HIKE PRICE INCREASE PRIVATE CONSUMPTION PROBABILITY OF DEFAULT PRODUCTION COSTS PRODUCTION FUNCTION PROFIT MARGIN PROPERTY RIGHTS PRUDENTIAL REGULATIONS RATE OF INFLATION REAL CONSUMPTION REAL INVESTMENT RECESSION REGULATORY AUTHORITY REGULATORY FRAMEWORK REGULATORY REFORMS REGULATORY REGIMES REPAYMENT RESERVE RESERVE ADEQUACY RESERVE REQUIREMENTS RESERVES RETAINED EARNINGS RETURN RETURN ON EQUITY RISK AVERSE RISK EXPOSURE RISK MANAGEMENT RISK PREMIUM RISK TAKING SECURITIES SIGNALING SOLVENCY SUBSTITUTION EFFECT SUPPLY CURVE TERMS OF CREDIT TOTAL CREDIT TOTAL CURRENCY TRANSMISSION MECHANISM TRANSMISSION OF MONETARY POLICY TRANSPARENCY UNCERTAINTY UNDERDEVELOPED CAPITAL MARKETS UPWARD JUMP UPWARD PRESSURE VALUE OF COLLATERAL VULNERABILITY TO SHOCKS WAGES WEALTH WEIGHTS WORKING CAPITAL WRITEDOWNS
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091007120449 http://hdl.handle.net/10986/4262

Internet

http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20091007120449
http://hdl.handle.net/10986/4262

Cyclical Effects of Bank Capital Requirements with Imperfect Credit Markets

Internet

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