Liquidity and risk management

Bengt Holmström, Jean Tirole

    Research output: Contribution to journalArticlepeer-review

    78 Scopus citations

    Abstract

    Firms and financial institutions are best viewed as ongoing entities, whose project completion may require renewed injections of liquidity. This paper proposes a contract-theoretic framework integrating three dimensions of corporate financing and prudential regulation: (1) liquidity management, (b) risk management, and (c) capital structure. It concludes with a preliminary assessment of recent regulatory approaches to the treatment of market risk.

    Original languageEnglish (US)
    Pages (from-to)295-319
    Number of pages25
    JournalJournal of Money, Credit and Banking
    Volume32
    Issue number3
    DOIs
    StatePublished - Aug 1 2000

    ASJC Scopus subject areas

    • Accounting
    • Finance
    • Economics and Econometrics

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