Essays in financial stability and public policy

Bálint Horváth

Research output: ThesisDoctoral ThesisScientific

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Abstract

This dissertation is a collection of essays in two areas of financial stability. The first part deals with systemic risk in the banking sector. First, it asks whether countercyclical macroprudential policy tools can be an effective way of reducing cyclicality in bank lending. The main finding is that these policies can be counterproductive and may incentivize more intertwined banks, and hence, endanger financial stability. The next paper investigates, and provides some evidence of, the possibility that banks actively change their portfolios in order to
influence the likelihood of joint bank failure.
The second part of this dissertation studies the connection between public finance and financial stability. Chapter 4 looks into the interaction between bank capital regulation and taxation and finds that banks trade off leverage risk against portfolio risk in response to a higher corporate income tax rates. Finally, Chapter 5 analyses banks’ excessive holdings of domestic government debt as one of the sources of the interrelatedness of public finance and bank stability. Two possible explanations of banks’ home bias are tested: voluntary government
bond hoarding and government induced bond buying.
Original languageEnglish
QualificationDoctor of Philosophy
Awarding Institution
  • Tilburg University
Supervisors/Advisors
  • Huizinga, Harry, Promotor
  • Wagner, Wolf, Promotor
Award date2 Nov 2015
Place of PublicationTilburg
Publisher
Print ISBNs978 90 5668 460 0
Publication statusPublished - 2015

Fingerprint

Public policy
Financial stability
Public finance
Bank lending
Portfolio risk
Policy tools
Corporate income tax
Tax rate
Cyclicality
Trade-offs
Systemic risk
Bank failure
Government
Home bias
Leverage
Bank stability
Capital taxation
Government debt
Interaction
Bank capital regulation

Cite this

Horváth, B. (2015). Essays in financial stability and public policy. Tilburg: CentER, Center for Economic Research.
Horváth, Bálint. / Essays in financial stability and public policy. Tilburg : CentER, Center for Economic Research, 2015. 173 p.
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Horváth, B 2015, 'Essays in financial stability and public policy', Doctor of Philosophy, Tilburg University, Tilburg.

Essays in financial stability and public policy. / Horváth, Bálint.

Tilburg : CentER, Center for Economic Research, 2015. 173 p.

Research output: ThesisDoctoral ThesisScientific

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Horváth B. Essays in financial stability and public policy. Tilburg: CentER, Center for Economic Research, 2015. 173 p. (CentER Dissertation Series).