EconPapers    
Economics at your fingertips  
 

WHEN PRIME DEPOSITORS RUN ON THE BANKS: A BEHAVIORAL APPROACH

Natanael Waraney Gerald Massie (natanael.waraney@ui.ac.id) and Chaikal Nuryakin
Additional contact information
Natanael Waraney Gerald Massie: Universitas Indonesia

Bulletin of Monetary Economics and Banking, 2020, vol. 23, issue 1, 139-152

Abstract: This paper examines the effect of two psychological attributes, namely an individual’s risk and time preference, on withdrawal decisions. Our sample is a pool of prime depositors in Indonesia, mainly due to the country’s deposit market being heavily concentrated on such depositors. We find that most of the prime depositors are risk averse long-term depositors. The regression results show that there is a significant correlation between the decision to withdraw and individual risk and time preference in most economic shock scenarios. The study concludes that a bank-run could happen if the rupiah depreciates by approximately 27% (from Rp 13,436 to Rp 17,000) and when there is a medium or a large bank failure.

Keywords: Withdrawal Decision; Time Preference; Risk Preference; Bank Run; Bank Depositor (search for similar items in EconPapers)
JEL-codes: D81 G02 G21 (search for similar items in EconPapers)
Date: 2020
References: Add references at CitEc
Citations:

Downloads: (external link)
https://bulletin.bmeb-bi.org/cgi/viewcontent.cgi?article=1065&context=bmeb (application/pdf)

Related works:
Working Paper: When Prime Depositors Run on the Banks: A Behavioral Approach (2017) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:idn:journl:v:23:y:2020:i:1g:p:139-152

DOI: 10.21098/bemp.v23i1.954

Access Statistics for this article

Bulletin of Monetary Economics and Banking is currently edited by Paresh Narayan

More articles in Bulletin of Monetary Economics and Banking from Bank Indonesia Contact information at EDIRC.
Bibliographic data for series maintained by Lutzardo Tobing (lutzardo@bi.go.id this e-mail address is bad, please contact repec@repec.org) and Jimmy Kathon (jimmy_k@bi.go.id).

 
Page updated 2024-12-28
Handle: RePEc:idn:journl:v:23:y:2020:i:1g:p:139-152