The Legacy of Deposit Insurance: The Growth, Spread, and Cost of Insuring Financial Intermediaries
In: The Defining Moment: The Great Depression and the American Economy in the Twentieth Century
AbstractWithout the Great Depression, the United States would not have adopted deposit insurance. While the New Deal's anti-competitive barriers have largely collapsed become" deeply rooted. This paper examines how market and political competition for deposits raised the level of coverage and spread insurance to all depository institutions. A comparison of the cost of federal insurance with a counterfactual of an insurance-free system shows that federal insurance ultimately imposed a" higher cost but achieved political acceptance because of the distribution of the burden.
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Other versions of this item:
- Eugene N. White, 1997. "The Legacy of Deposit Insurance: The Growth, Spread, and Cost of Insuring Financial Intermediaries," NBER Working Papers 6063, National Bureau of Economic Research, Inc.
- N22 - Economic History - - Financial Markets and Institutions - - - U.S.; Canada: 1913-
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
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- Luc Laeven, 2004.
"The Political Economy of Deposit Insurance,"
Journal of Financial Services Research,
Springer, vol. 26(3), pages 201-224, December.
- Demirguc-Kunt, Asli & Kane, Edward J. & Laeven, Luc, 2006.
"Determinants of deposit-insurance adoption and design,"
Policy Research Working Paper Series
3849, The World Bank.
- Demirgüç-Kunt, Asli & Kane, Edward J. & Laeven, Luc, 2008. "Determinants of deposit-insurance adoption and design," Journal of Financial Intermediation, Elsevier, vol. 17(3), pages 407-438, July.
- Asli Demirguc-Kunt & Edward J. Kane & Luc Laeven, 2007. "Determinants of Deposit-Insurance Adoption and Design," NBER Working Papers 12862, National Bureau of Economic Research, Inc.
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