Journal Article
Deposit insurance reform; or, deregulation is the cart, not the horse
Abstract: This paper, originally published in the spring 1983 Quarterly Review, explains why flat-rate deposit insurance gives financial intermediaries an incentive to take on too much risk. It also discusses the purposes of deposit insurance and some ways reforms might serve those purposes. Three possible reforms are discussed: abolishing the insurance and requiring depository institutions to either hold safe assets or mark to market, reducing the deposit ceilings for insurance, and risk-adjusting the insurance premia. ; Originally published in Quarterly Review, Spring 1983
Keywords: Deposit insurance;
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Authors
Bibliographic Information
Provider: Federal Reserve Bank of Minneapolis
Part of Series: Quarterly Review
Publication Date: 1990
Volume: 14
Issue: Win
Pages: 3-11