Bank runs as a coordination problem within a two-bank set-up: Who will survive?

Ekaterina Shakina

Economics Letters, 2019, vol. 177, issue C, 85-88

Abstract: We experimentally test a new extension of the Diamond and Dybvig model with two banks where, in addition to keeping and withdrawing, depositors of the first bank can relocate their deposits to the second bank at no cost. In contrast to the second bank, the first bank experiences more panics, although the number of simultaneous bank runs decreases. We highlight the importance of studying bank runs as a system-related phenomenon where depositors can change their initial deposit allocation.

Keywords: Bank runs; Experiment; Coordination problem (search for similar items in EconPapers)
JEL-codes: C9 D8 G2 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165176519300369
Full text for ScienceDirect subscribers only

Related works:
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:eee:ecolet:v:177:y:2019:i:c:p:85-88

DOI: 10.1016/j.econlet.2019.01.028

Access Statistics for this article

Economics Letters is currently edited by Economics Letters Editorial Office

More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Catherine Liu ().