
doi: 10.1057/eej.2007.36
The paper investigates, and estimates, banks’ risk aversion that is factored into the spread between the interest rate on time deposits and the interest rate on non-time deposits. The estimation results indicate that the relative risk aversion coefficient estimates of individual banks fall between 0 and 1, but mostly around 0.2, thereby indicating that banks are risk-averse but close to being risk-neutral.
Banks, Risk Aversion, Deposit Rate Rigidity
Banks, Risk Aversion, Deposit Rate Rigidity
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