Finance: Research, Policy and Anecdotes

Before heading off into my summer holiday, some interesting papers I recently read:

My PhD student Mikael Homanen has gained quite some media attention with his paper on the Dakota Access Pipeline. He shows that protests against the banks funding this project ultimately resulted in deposit outflows for these banks, a powerful role for depositors in forcing banks to internalise the negative externalities (in this case of environmental nature) of their lending decisions. Among many others, the FT picked up on his paper.

Ahmed Tahoun and Laurence van Lent have an interesting paper on the role of personal wealth of politicians in bail-out decisions, now forthcoming in the Review of Finance. Controlling for many other factors, they find that Representatives with financial wealth interests in the banking system were more likely to vote in favour of the 2008 Emergency Economic Stabilization Act, even controlling for political beliefs and lobbying.  

Also forthcoming in the Review of Finance, a recent paper by Marcel Fratzscher and Malte Rieth, documenting the two-way spill-over between bank and sovereign risk in the Eurozone. The recent non-standard monetary policy by the ECB, on the other hand, has contributed to lowering both risks.

Overview