In addition to the Basel II capital ratio, Basel III requires banks to respect additional ratios,
such as leverage ratio, liquidity coverage ratio and net stable funding ratio. Banks are …

I develop an open economy model with banks facing foreign borrowing limits. The
interaction of banks' limited liability and deposit insurance leads banks into socially …

Banks generate excessive low&quality lending if they decide their optimal screening and
lending intensities without internalizing that their behavior alters the pool of borrowers faced …

This dissertation consists of three essays. In the first chapter, I develop a two-period small
open economy with banks. The interaction of the limited liability faced by banks and the …

In this chapter I will be exploring the application of the Pigovian theory to an industry that is
known for its many particularities. The financial industry has become the poster child for …

This paper is a quantitative study of two frictions that generate banks' underinvestment in
screening borrowers and, thus, overlending: 1) Limited liability, and 2) Banks failing to …

We study the interaction between imperfect information about the aggregate economy and
banks' lending standards. We obtain three results. First, we document that lending standards …