Eliminating Discount Window Stigma: What Can We Learn from Abroad?

Susan McLaughlin ()
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Susan McLaughlin: YPFS, Yale School of Management, https://elischolar.library.yale.edu/journal-of-financial-crises/

Journal of Financial Crises, 2025, vol. 7, issue 1, 690-706

Abstract: This article picks up from an earlier Journal of Financial Crisis policy note on discount window design to see how the experiences of other central banks can inform work to redesign the discount window to reduce stigma. As explained in that article, banks' reluctance to use the discount window is problematic for financial stability as it constrains the Fed's ability to use its liquidity provision tools to stem runs and mitigate contagion in times of stress. The stigma associated with discount window borrowing in the United States is well documented and is a multifaceted phenomenon.

Keywords: banking; central banking; crisis management; financial institutions; financial stability; liquidity; LOLR (search for similar items in EconPapers)
JEL-codes: G01 G28 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ysm:ypfsfc:v:7:y:2025:i:1:p:690-706

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