Panic bank runs
Kiss, Hubert Janos, Rodriguez-Lara, Ismael and Rosa-García, Alfonso (2018) Panic bank runs. Economics Letters, 162 . pp. 146-149. ISSN 0165-1765 [Article] (doi:10.1016/j.econlet.2017.11.014)
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Abstract
We provide experimental evidence that panic bank runs occur in the absence of problems with fundamentals and coordination failures among depositors, the two main culprits identified in the literature. Depositors withdraw when they observe that others do so, even when theoretically they should not. Our findings suggest that panic also manifests itself in the beliefs of depositors, who overestimate the probability that a bank run is underway. Loss-aversion has a predictive power on panic behavior, while risk or ambiguity aversion do not.
| Item Type: | Article |
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| Research Areas: | A. > Business School > Economics |
| Item ID: | 22917 |
| Notes on copyright: | © 2017 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/). |
| Useful Links: | |
| Depositing User: | Ismael Rodriguez-Lara |
| Date Deposited: | 13 Nov 2017 13:07 |
| Last Modified: | 29 Nov 2022 20:19 |
| URI: | https://eprints.mdx.ac.uk/id/eprint/22917 |
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