Does deposit insurance increase banking system stability ? An empirical investigation

Asli Demirguc-Kunt and Enrica Detragiache ()

No 2247, Policy Research Working Paper Series from The World Bank

Abstract: Based on evidence of 61 countries in 1980-97, the authors find that explicit deposit insurance tends to be detrimental to bank stability, the more so where bank interest rates are deregulated and the institutional environment is weak. The adverse impact of deposit insurance on bank stability tends to be stronger the more extensive is the coverage offered to depositors, and where the scheme is funded and run by the government rather than the private sector.

Keywords: Financial Intermediation; Banks&Banking Reform; Insurance&Risk Mitigation; Financial Crisis Management&Restructuring; Insurance Law; Insurance&Risk Mitigation; Financial Crisis Management&Restructuring; Financial Intermediation; Insurance Law; Banks&Banking Reform (search for similar items in EconPapers)
Date: 1999-11-30
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Citations: View citations in EconPapers (50)

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Related works:
Journal Article: Does deposit insurance increase banking system stability? An empirical investigation (2002)
Working Paper: Does Deposit Insurance Increase Banking System Stability? An Empirical Investigation (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:wbk:wbrwps:2247

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