Financial Intermediary-Coalitions
Open accessPreprint — published as 10.1016/0022-0531(86)90115-8 · Paper page
Abstract
In this article an environment in which the investment opportunities of agents are private information is studied and it is shown that financial intermediaries arise endogenously within that environment. It is established that financial intermediaries are part of an efficient arrangement in the sense that they are needed to support the authors' private information core allocations. These intermediaries, which are coalitions of agents, exhibit the following characteristics in equilibrium: they borrow from and lend to large groups of agents; they produce information about investment projects; and they issue claims that have different state contingent payoffs than claims issued by ultimate borrowers.
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References 20 · Cited by 1,440
- Authors
- Boyd, J. H., & Prescott, E. C.
- Affiliations
- University of Minnesota (US)
- Venue
- Journal of Economic Theory
- Publisher
- Federal Reserve Bank of Minneapolis
- Published
- 1985-07
- Volume
- 38
- Issue
- 2
- Pages
- 211-232
- ISSN
- 0022-0531 (ISSN-L)
- OpenAlex
- W2084894276
- Cited by
- 1,440
- References
- 20
- Citations by year
- 2026: 23 · 2025: 43 · 2024: 33 · 2023: 46 · 2022: 31 · 2021: 60 · 2020: 43 · 2019: 64 · 2018: 58 · 2017: 63 · 2016: 53 · 2015: 64 · 2014: 69 · 2013: 65 · 2012: 75
- FWCI
- 43.87
- Type
- journal article
- Language
- en
- Open access
- green
- doi.org
- Licence
- cc-by-nc
- Locations
- Journal of Economic Theory (publishedVersion)
- RePEc: Research Papers in Economics (submittedVersion)
- Funders
- National Science Foundation
- University of Minnesota
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic theories and models
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Game Theory and Voting Systems
- Social Sciences › Economics, Econometrics and Finance › Finance › Banking stability, regulation, efficiency
- Keywords
- financial intermediaries, private information, investment opportunities, information production, state-contingent claims, lending and borrowing, efficient allocation
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