Empirical banking: methods and applications
ENSAE Master 2 – March/April 2018
Course schedule: 23, 30 March, 6, 13 April 2018.
1. Why do banks exist? Relationship-banking in normal times and during crises. Securitization and the originate-to-distribute model.
2. More finance, more growth? Financial development, the efficiency of financial intermediation, rents and bankers’ pay
3. Do we need big banks? The rise of the banking giants, economies of scale and scope, the too-big-to-fail problem.
4. Global banks: more stability or more contagion? The international transmission of policy and liquidity shocks.
5. The transmission of monetary policy: the bank lending channel. Also: slides of Andrade, Cahn, Fraisse and Mésonnier on impact of 2011 LTROs
Papers for in-class presentations (15 minutes + discussion)
On relationship banking :
Nguyen, 2017. Are credit markets still local: evidence from bank branch closings, forthcoming, AEJ Applied.
On finance and growth :
Bertrand, Schoar, Thesmar, 2007. Banking deregulation and industry structure: evidence from the French banking reforms of 1985. Journal of Finance, 62(2), April.
Homework assignement (deadline: 29 April 2018)
You will write a 2-3 pages commentary on one of the selected papers below. Your work will take the form of a referee report for a fictitious journal. The standard outline of such a report is the following:
- short summary of the paper, its methodology and its main results (less
than one page),
- general assessment (praise and weaknesses: one paragraph)
- main comments (a series of -methodological, econometric, conceptual...- issues to be solved or improved, or important questions that need to be answered, in particular if the journal is to publish the paper)
- minor comments (a few other points)
Groppe, Reint; Mosk, Thomas; Ongena, Steven; Wix, Carlo, 2016. Bank response to higher capital requirements: Evidence from a quasi-natural experiment: https://www.econstor.eu/bitstream/10419/148361/1/874406994.pdf
Claesens, Stijn, Hassib, Omar and Van Horen, Neeltje, (2017), The Role of Foreign Banks in Trade, No 11821, CEPR Discussion Papers, C.E.P.R. Discussion Papers: http://EconPapers.repec.org/RePEc:cpr:ceprdp:11821.
Crosignani, Matteo, Miguel Faria-e-Castro, and Luís Fonseca (2017). "The (Unintended?) Consequences of the Largest Liquidity Injection Ever," Finance and Economics Discussion Series 2017-011. Board of Governors of the Federal Reserve System (U.S.)