Poets as consultants? Economic contract theory in German literature
In German literature, particularly in poetry, an amazing wealth of illustrations for economic contract theory can be found. Signaling, screening, incentive contracts, the winner's curse, and even the...
Do Depositors Discipline Swiss Banks?
Urs Birchler, Andréa M. Maechler
In this paper, we test for the presence of market discipline in the Swiss deposit market. In particular, we examine whether depositors monitor their banks by withdrawing their saving deposits...
Can bank supervisors rely on market data? A critical assessment from a Swiss perspective
Birchler, Urs, Facchinetti, Matteo
Market data, such as bond spreads or equity price volatility, are a complementary source to bank supervisory information. In Switzerland, meaningful market data are available for a number of banks...
What Does the Yield on Subordinated Bank Debt Measure?
We provide evidence that a bank's subordinated debt yield spread is not, by itself, a sufficient measure of default risk. We use a model in which subordinated debt is held by investors with superior...