Search results for: Author=Hellwig, Martin [231]

Pages

Forthcoming
The Leverage Ratchet Effect
Journal of Finance
Bonn
forthcoming
2017
Carving out legacy assets: a successful tool for bank restructuring?
2017/03
Max Planck Institute for Research on Collective Goods
Bonn
2017
Abstract
Beginning with the proposal by Enria (2017), the paper discusses the scope for successful bank restructuring through a carveout of impaired assets and a transfer of these assets to a government-sponsored asset management company. The paper argues that the success of such an operation requires a use of public funds, either outright or through contingent commitments. Clawback provisions are problematic because they create contingent liabilities that merely shift risks from the assets side to the liabilities sides of banks’ balance sheets. The paper distinguishes between asset impairments coming from considerations of prospective returns and asset impairments coming from frictions in the markets in which these assets are traded. It also distinguishes between threats to bank solvency and threats to bank funding/liquidity. In each case, the success of bank restructuring from asset carveouts depends on the extent to which threats to the bank’s solvency is eliminated. If these threats concern bank funding and asset liquidations at depressed prices, public funds may eventually not be needed. If threats to bank solvency come from nonperforming loans, taxpayer support may be essential. The notion of “real economic value” as the price at which assets should be transferred is problematic and leaves ample room for hidden subsidies. The success of restructuring of the individual bank may itself come at a risk to financial stability as the preservation of existing capacities maintains competitive pressure and depresses bank profitability. Additional risks may come from the burden on the government’s fiscal stance.
HSH Nordbank: Verantwortlichkeit in der Demokratie
Wirtschaftsdienst
97
1
4-5
2017
Italiens Banken – Die Probleme werden verschleppt
Wirtschaftswoche online
2017
Probability Measures on Product Spaces with Uniform Metrics
2017/06
Max Planck Institute for Research on Collective Goods
Bonn
2017
Abstract
For a countable product of complete separable metric spaces with a topology induced by a uniform metric, the set of Borel probability measures coincides with the set of completions of probability measures on the product σ-algebra. Whereas the product space with the uniform metric is non-separable, the support of any Bofrel measure is separable, and the topology of weak convergence on the space of Borel measures is metrizable by both the Prohorov metric and the bounded Lipschitz metric.
The Generic Possibility of Full Surplus Extraction in Models with Large Type Spaces
2017/02
Max Planck Institute for Research on Collective Goods
Bonn
2017
Abstract
McAfee and Reny (1992) have given a necessary and sufficient condition for full surplus extraction in naive type spaces with a continuum of payoff types. We generalize their characterization to arbitrary abstract type spaces and to the universal type space and show that in each setting, full surplus extraction is generically possible. We interpret the McAfee-Reny condition as a much stronger version of injectiveness of belief functions and prove genericity by arguments similar to those used to prove the classical embedding theorem for continuous functions. Our results can be used to also establish the genericity of common priors that admit full surplus extraction.
Wachstumsschwäche, Bankenmalaise und Bankenregulierung
Wirtschaftsdienst
97
13
43-48
2017
2016
A Homeomorphism Theorem for the Universal Type Space with the Uniform Topology
2016/17
Max Planck Institute for Research on Collective Goods
Bonn
2016
Abstract
The paper proves a homeomorphism theorem for the universal type space with the uniform strategic topology or the uniform weak topology that Dekel et al. (2006) and Chen et al. (2010) introduced in order to take account of the fact that beliefs of arbitrarily high orders in agents' belief hierarchies can have a significant impact on strategic behaviour. Probability measures on the larger σ-algebras associated with these finer topologies are the completions of probability measures on the product σ-algebras, Kolmogorov's extension theorem can still be used to derive probability measures from belief hierarchies. The extended Kolmogorov mapping that is thus obtained is a homeomorphism.
Es droht eine neue Finanzkrise
Frankfurter Allgemeine Sonntagszeitung
44
2016
Neoliberale Sekte oder Wissenschaft? Zum Verhältnis von Grundlagenforschung und Politikanwendung in der Ökonomie
Den Diebstahl des Wohlstands verhindern
118-121
Springer
Berlin
2016