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A note on convergence of Peck-Shell and Green-Lin mechanisms in the Diamond-Dybvig model
(Fundação Getulio Vargas. Escola de Pós-graduação em Economia, 2011-07-27)
We study the effects of population size in the Peck-Shell analysis of bank runs. We find that a contract featuring equal-treatment for almost all depositors of the same type approximates the optimum. Because the approximation ...