A plan for better banking: Researchers propose model of systemwide diversification
Monday, July 25, 2011 - 08:30
in Mathematics & Economics
As much of the developed world continues to dig out from the impact of the 2008 financial crisis, a team of researchers at Harvard and in London has created a model of bank failure aimed at helping economies avoid crashes. Their work highlights a fundamental dilemma for regulators: Improving the safety of individual banks may make the financial system as a whole more dangerous.