The Contribution of Large Banking Institutions to Systemic Risk: What Do We Know? A Literature Review

Research output: Journal contributionsJournal articlesResearchpeer-review

Standard

The Contribution of Large Banking Institutions to Systemic Risk: What Do We Know? A Literature Review. / Moch, Nils.
In: Review of Economics, Vol. 69, No. 3, 01.12.2018, p. 231-257.

Research output: Journal contributionsJournal articlesResearchpeer-review

Harvard

APA

Vancouver

Bibtex

@article{ded11f87a86c41f6b9f9ccf8aee73c2c,
title = "The Contribution of Large Banking Institutions to Systemic Risk: What Do We Know? A Literature Review",
abstract = "Against the background of the global financial crisis, we review recent literature on the debate about {"}too big to fail{"}. This is (still) one of the key issues in banking literature since it determines the conditions for adequate banking regulation, financial stability and economic welfare. Analyzing 30 papers from 2009 to 2017, our work focusses on the impact of large banks on systemic risk. Large financial institutions can affect systemic risk by either contributing to systemic risk or being extremely exposed to sources of systematic risk and contagion. We find a considerable number of theoretical and empirical studies providing evidence that against the background of the constitution of present-day real financial systems, bank size is a key predictor for systemic risk and that the largest banks disproportionately contribute to overall risk. This relationship is found in samples of different composition, for various periods and with different measures covering diverse aspects of systemic risk.",
keywords = "bank bailouts, banking crises, financial stability, systemic risk, too big to fail, Management studies",
author = "Nils Moch",
year = "2018",
month = dec,
day = "1",
doi = "10.1515/roe-2018-0011",
language = "English",
volume = "69",
pages = "231--257",
journal = "Review of Economics",
issn = "0948-5139",
publisher = "De Gruyter Oldenbourg ",
number = "3",

}

RIS

TY - JOUR

T1 - The Contribution of Large Banking Institutions to Systemic Risk

T2 - What Do We Know? A Literature Review

AU - Moch, Nils

PY - 2018/12/1

Y1 - 2018/12/1

N2 - Against the background of the global financial crisis, we review recent literature on the debate about "too big to fail". This is (still) one of the key issues in banking literature since it determines the conditions for adequate banking regulation, financial stability and economic welfare. Analyzing 30 papers from 2009 to 2017, our work focusses on the impact of large banks on systemic risk. Large financial institutions can affect systemic risk by either contributing to systemic risk or being extremely exposed to sources of systematic risk and contagion. We find a considerable number of theoretical and empirical studies providing evidence that against the background of the constitution of present-day real financial systems, bank size is a key predictor for systemic risk and that the largest banks disproportionately contribute to overall risk. This relationship is found in samples of different composition, for various periods and with different measures covering diverse aspects of systemic risk.

AB - Against the background of the global financial crisis, we review recent literature on the debate about "too big to fail". This is (still) one of the key issues in banking literature since it determines the conditions for adequate banking regulation, financial stability and economic welfare. Analyzing 30 papers from 2009 to 2017, our work focusses on the impact of large banks on systemic risk. Large financial institutions can affect systemic risk by either contributing to systemic risk or being extremely exposed to sources of systematic risk and contagion. We find a considerable number of theoretical and empirical studies providing evidence that against the background of the constitution of present-day real financial systems, bank size is a key predictor for systemic risk and that the largest banks disproportionately contribute to overall risk. This relationship is found in samples of different composition, for various periods and with different measures covering diverse aspects of systemic risk.

KW - bank bailouts

KW - banking crises

KW - financial stability

KW - systemic risk

KW - too big to fail

KW - Management studies

UR - http://www.scopus.com/inward/record.url?scp=85058407923&partnerID=8YFLogxK

U2 - 10.1515/roe-2018-0011

DO - 10.1515/roe-2018-0011

M3 - Journal articles

AN - SCOPUS:85058407923

VL - 69

SP - 231

EP - 257

JO - Review of Economics

JF - Review of Economics

SN - 0948-5139

IS - 3

ER -

DOI

Recently viewed

Researchers

  1. Kerstin Nolte

Publications

  1. Harmful interference and human rights
  2. Pelvis and hips
  3. Sowing density
  4. Associations between the financial and industry expertise of audit committee members and Key Audit Matters within related audit reports
  5. The Settlement of EEZ Fisheries Access Disputes under UNCLOS
  6. Single, Double and Quadruple Maximum Power Point Trackers for a Stand-Alone Photovoltaic System
  7. Tourists’ Weather Perceptions and Weather Related Behavior
  8. The parrot knew everything
  9. Expatriate Management
  10. Adaptation and validation of the Digital Health Literacy Instrument for Portuguese university students
  11. Hacking Crowdfunding
  12. One voice, one message, but conflicting goals
  13. European welfare states constructing “Unaccompanied Minors”
  14. Sensor Measures of Affective Leaning
  15. Meta-custom and the court
  16. You Can't Always Get What You Want
  17. Reframing the Food–Biodiversity Challenge
  18. Reprint of
  19. Fly
  20. Applying the ecosystem services framework to pasture-based livestock farming systems in Europe
  21. Strategic networking for sustainability
  22. Frustrated and helpless - sources and consequences of students’ negative deactivating emotions in university mathematics
  23. Digital skills in healthcare
  24. Bonus
  25. The Emerging Research Field of Experimentation for Circular Business Model Innovation
  26. Examining the effect of principal turnover on teaching quality
  27. Microstructure and creep properties of MEZ magnesium alloy processed by thixocasting
  28. Doing a transversal method
  29. Are We Discovering or Making Concepts? Performativity in Concept Defining
  30. Introduction to The Psychology of Entrepreneurship
  31. Dissensfiktion als Element formaler Organisation.
  32. Legal aspects of satellite-based earth observation
  33. Supporting Diffusion of IoT Solutions Exemplified by the ChainPORT Initiative
  34. Einführung
  35. Toward a Design Compendium for Metal Binder Jetting
  36. Incentives Matter, But What Do They Mean? Understanding the Meaning of Market Coordination
  37. On the application of laser shock peening for retardation of surface fatigue cracks in laser beam-welded AA6056