TY  - JOUR
AU  - Calomiris,Charles W.
TI  - Bank Failures in Theory and History: The Great Depression and Other "Contagious" Events
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13597
PY  - 2007
Y2  - November 2007
UR  - http://www.nber.org/papers/w13597
L1  - http://www.nber.org/papers/w13597.pdf
N1  - Author contact info:
Charles W. Calomiris
Graduate School of Business
Columbia University
3022 Broadway Street, Uris Hall
New York, NY 10027
Tel: 212/854-8748
Fax: 212/316-9219
E-Mail: cc374@columbia.edu
AB  - Bank failures during banking crises, in theory, can result either from unwarranted depositor withdrawals during events characterized by contagion or panic, or as the result of fundamental bank insolvency. Various views of contagion are described and compared to historical evidence from banking crises, with special emphasis on the U.S. experience during and prior to the Great Depression. Panics or "contagion" played a small role in bank failure, during or before the Great Depression-era distress. Ironically, the government safety net, which was designed to forestall the (overestimated) risks of contagion, seems to have become the primary source of systemic instability in banking in the current era.
ER  -