Discussion Papers

We show theoretically and empirically that flows into index funds raise the prices of large stocks in the index disproportionately more than the...

In this study, we propose an implied forward-looking measure for systemic risk that employs the information from put option prices, the Systemic...

The effects of large banks on the real economy are theoretically ambiguous and politically controversial. I identify quasi-exogenous increases in bank...

The paper studies incentives and trading decisions of an arbitrageur who can take concentrated bets in an illiquid market and who cares about interim...

It is sometimes said that an effect of the COVID-19 pandemic will be heightened appreciation of the importance of scientific research and expertise...

What drives actual government policies after financial crises? In this paper, we first present a simple model of post-crisis policymaking driven by...

We generalise a stochastic version of the workhorse SIR (Susceptible-Infectious- Removed) epidemiological model to account for spatial dynamics...

Due to their complex features, structured financial products can hurt the average investor. Are certain investors particularly vulnerable? Using...

The literature has provided over a dozen explanations for the widely documented excessive trading puzzle of retail investors trading so much that it...

This paper surveys the state of the art in research in racetrack and lottery markets. Market efficiency and the pricing of various wagers is studied...

We study the transmission of liquidity shocks from one sector of the economy to other sectors in a general equilibrium model with multiple trading...

This paper analyses of how risk is allocated in China’s markets for debt issued by non-financial enterprises. Compared to other major corporate bond...

We explore the dynamics of media chatter about economic reforms using text analysis from about a billion newspaper articles in 28 languages. We show...

We investigate the causal impact of financial risk on economic growth, using a panel spanning 150 years and 74 countries. Persistent low risk...

During the unfolding of a crisis, it is crucial to determine its severity, yet access to reliable data is challenging. We investigate the relation...

We assess the ability of an information aggregation mechanism that operates in the over-the-counter market for financial derivatives to reduce...