Financial Architecture and Financial Stability
Posted: 9 Nov 2021
There are 3 versions of this paper
Financial Architecture and Financial Stability
Annual Review of Financial Economics, Vol. 13, pp. 129-151, 2021
Posted: 09 Nov 2021
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Financial Architecture and Financial Stability
Number of pages: 30
Posted: 04 May 2021
Last Revised: 27 May 2021
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Financial Architecture and Financial Stability
CEPR Discussion Paper No. DP16204
Number of pages: 33
Posted: 14 Jul 2021
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1
Date Written: November 2021
Abstract
This article studies the links between financial stability and the architecture of financial systems. We review the existing literature and provide organizing frameworks for analyzing three empirically important aspects of financial architecture: the rise of nonbank financial intermediaries, the regulatory response to these structural changes, and the emergence of complex interbank networks. One of our main new results is a necessary and sufficient condition for whether nonbank intermediaries are immune to runs in an extended version of the Diamond–Dybvig model.
Suggested Citation: Suggested Citation
Allen, Franklin and Walther, Ansgar, Financial Architecture and Financial Stability (November 2021). Annual Review of Financial Economics, Vol. 13, pp. 129-151, 2021, Available at SSRN: https://ssrn.com/abstract=3957030 or http://dx.doi.org/10.1146/annurev-financial-110217-022851
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