Banks and Markets from an Insurance Perspective

Goguel, Amaury; Miéra, Maxence

Document type :

Compte-rendu et recension critique d'ouvrage

DOI :

10.1007/s40953-023-00365-8

Title :

Banks and Markets from an Insurance Perspective

Author(s) :

Goguel, Amaury [Auteur]
SKEMA Business School
Miéra, Maxence [Auteur]
Lille économie management - UMR 9221 [LEM]
Université d'Artois [UA]

Journal title :

Journal of Quantitative Economics

Pages :

943–957

Publisher :

The Indian Econometric Society

Publication date :

2023-08-05

ISSN :

0971-1554

English keyword(s) :

Banks
Markets
Insurance

HAL domain(s) :

Sciences de l'Homme et Société/Economies et finances

English abstract : [en]

This article aims to clarify the analogy between contingent claims in a complete market and banking contracts in a capitalized financial intermediary that combines both deposit and equity. It brings together insurance ...
Show more >This article aims to clarify the analogy between contingent claims in a complete market and banking contracts in a capitalized financial intermediary that combines both deposit and equity. It brings together insurance theory and financial intermediation theory in a synthetic model by focusing on the risk allocation function rather than on a particular kind of institutional arrangement. The model includes both idiosyncratic liquidity risk and aggregate uncertainty on asset return, and it focuses on risk allocation in a perfect information setting from an insurance perspective. This article then highlights that equity contracts are equivalent to state-contingent claims in the aggregate-risk shifting, that deposit contracts are equivalent to type-contingent claims in the idiosyncratic-risk mutualization, and that banks and markets both implement the optimal allocation by simply using different mechanisms.Show less >

Language :

Anglais

Popular science :

Non

Collections :

Lille Économie Management (LEM) - UMR 9221

Source :

Harvested from HAL

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