Financial Intermediaries, Markets and Growth

60 Pages Posted: 8 Jun 2016

See all articles by Falko Fecht

Falko Fecht

Frankfurt School of Finance & Management

Kevin X. D. Huang

Federal Reserve Bank of Philadelphia; Vanderbilt University - College of Arts and Science - Department of Economics

Antoine Martin

Federal Reserve Bank of New York - Research and Statistics

Multiple version iconThere are 2 versions of this paper

Date Written: 2005

Abstract

We build a model in which financial intermediaries provide insurance to households against a liquidity shock. Households can also invest directly on a financial market if they pay a cost. In equilibrium, the ability of intermediaries to share risk is constrained by the market. This can be beneficial because intermediaries invest less in the productive technology

Keywords: Financial Intermediaries, Risk Sharing, Finance and Growth, Comparing Financial Systems

JEL Classification: E44, G20, G10

Suggested Citation

Fecht, Falko and Huang, Kevin X. D. and Martin, Antoine, Financial Intermediaries, Markets and Growth (2005). Bundesbank Series 1 Discussion Paper No. 2005,03. Available at SSRN: https://ssrn.com/abstract=2785089

Falko Fecht (Contact Author)

Frankfurt School of Finance & Management ( email )

Adickesallee 32-34
Frankfurt am Main, 60322
Germany

Kevin X. D. Huang

Federal Reserve Bank of Philadelphia ( email )

Ten Independence Mall
Philadelphia, PA 19106-1574
United States

Vanderbilt University - College of Arts and Science - Department of Economics ( email )

Box 1819 Station B
Nashville, TN 37235
United States

Antoine Martin

Federal Reserve Bank of New York - Research and Statistics ( email )

33 Liberty Street
New York, NY 10045
United States
212-720-6943 (Phone)

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