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Bank Failures: The Roles of Solvency and Liquidity

Bank Failures: The Roles of Solvency and Liquidity

Do banks fail because of runs or because they become insolvent? Answering this question is central to understanding financial crises and designing effective financial stability policies. Long-run historical evidence reve...

The R*–Labor Share Nexus

The R*–Labor Share Nexus

The authors provide a simple model that captures the joint evolution of the labor share and the natural rate of interest, referred to as "r-star."