Region Focus

2007

 

Fall 2007

Runs Make the Bank

The fragile capital structure of banks makes them inevitably prone to runs, and that's a good thing
By Vanessa Sumo


Related Links

Diamond, Douglas W."Banks and Liquidity Creation: A Simple Exposition of the Diamond-Dybvig Model"Federal Reserve Bank of Richmond Economic Quarterly, Spring 2007, vol. 93, no. 2, pp. 189-200

Diamond, Douglas W., and Philip H. Dybvig. "Bank Runs, Deposit Insurance, and Liquidity." Federal Reserve Bank of Minneapolis Quarterly Review, Winter 2000, vol. 24, no. 1, pp. 14-23.

Diamond, Douglas W., and Raghuram G. Rajan. "A Theory of Bank Capital." NBER Working Paper no. 7431, December 1999.

Diamond, Douglas W., and Raghuram G. Rajan. "Liquidity Risk, Liquidity Creation and Financial Fragility: A Theory of Banking." NBER Working Paper No. 7430, December 1999.

Gorton, Gary, and Andrew Winton. "Financial Intermediation." NBER Working Paper no. 8928, May 2002.

Wallace, Neil. "Narrow Banking Meets the Diamond-Dybvig Model." Federal Reserve Bank of Minneapolis Quarterly Review, Winter 1996, vol. 20, no. 1, pp. 3-13.

Contact Us

Richmond

Aaron Steelman
Publications Director
(804) 697-2658