Andrew Gimber

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I am a fifth-year PhD candidate in the economics department of the European University Institute in Florence, Italy.

My research interests are in banking and financial crises, macroeconomic coordination failures, unemployment and monetary economics.

Contact Details

Villa San Paolo
Via della Piazzuola 43
50133 Firenze
Italy

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Work in Progress

“Bank resolution, bailouts and the time consistency problem”

(Latest draft available on request.)

Abstract: The choice between resolving insolvent banks and bailing them out creates a time consistency problem. To deter banks from taking excessive risks, governments want to convince them that they will choose resolution. However, when facing the costs of liquidating banks, governments may be tempted to bail them out instead. By strengthening their bank resolution regimes, governments reduce these costs, thus credibly committing themselves to choosing resolution over bailouts. Governments with greater resources face a more severe commitment problem. When banks interact strategically, improving the resolution regime can eliminate equilibria in which they coordinate on risky investment strategies.

Teaching