• Graduate Program
    • Why study Business Data Science?
    • Program outline
    • Courses
    • Course registration
    • Admissions
    • Facilities
  • Research
  • News
  • Events
    • Summer School
      • Summer school
      • Deep Learning
      • Econometrics and Data Science Methods for Business, Economics and Finance
      • Foundations of Machine Learning with Applications in Python
      • Networks in Micro- and Macroeconomics
      • Tinbergen Institute Summer School Program
    • Events Calendar
    • Events archive
    • Conference: Consumer Search and Markets
    • Tinbergen Institute Lectures
  • Summer School
  • Alumni
Home | Courses | Banking


  • Teacher(s)
    Enrico Perotti, Xinyi Wang, Spyridon Terovitis
  • Research field
    Finance, Finance
  • Dates
    Period 1 - Aug 29, 2022 to Oct 21, 2022
  • Course type
  • Program year
  • Credits

Course description

The course reviews the literature on financial intermediation and is relevant for students interested in finance, macroeconomics, and governance. It combines a classic contractual approach with recent work on system-wide risk creation. Drawing from the lesson of the crisis, it focuses on the risk transformation role of banks and shadow banks and the sources of endogenous credit cycles and instability. A key goal is to offer foundations for micro and macro-prudential policy reform, drawing from models of opportunism, risk externalities, or behavioral biases. Topics include debt optimality, moral hazard in risk choices, financial externalities, maturity and liquidity risk transformation, endogenous risk, induced runs, demand for safety, and their implications for capital and liquidity regulation.


Recommended: Contract Theory, Corporate Finance

Course literature

Primary reading
- Selected papers.