crime and ethics abstract we consider a simple model in which agents are endowed with heterogeneous abilities and differing degrees of honesty agents choose either to commit property crimes or invest in education and become workers instead the model is closed in that all criminal proceeds are stolen from agents working in the formal sector and that expenditures on both deterrence and punishment of criminals are paid for through taxes levied on workers thus although we assume that there are no direct interactive effects among criminals criminals crowd each other in two ways positively in that enforcement and punishment resources become more widely diffused as more agents commit crimes and negatively in that the presence of more criminals implies that there is less loot to be divided over a larger number of thieves we establish the possibility of multiple equilibria and characterize the equilibrium properties we then evaluate the effectiveness of deterrence policies under a balanced government budget

testing for non jointness in oil and gas exploration a variable profit function approach although the assumption of non joint production is made in a number of areas of economics its empirical validity is seldom examined in this paper we investigate the hypothesis of non jointness in the context of a multiple output production process which utilizes both fixed and variable inputs specifically we test the hypothesis of almost non jointness in the input quantities and prices as well as the hypothesis that inputs and outputs are separable using data on oil and natural gas exploration in alberta canada to facilitate global tests of these hypotheses we estimate a generalized linear generalized leontief variable profit function both with and without the restrictions implied by nonjointness and by separability on the basis of likelihood ratio tests we reject the hypothesis of separability but are unable to reject the non jointness hypothesis based on the maximum likelihood estimates obtained in the non joint case we examine some empirical issues concerning oil and gas exploration activity

nonrenewable resource scarcity nonrenewable resource theory often is summarized by hotelling s rule this paper reviews theoretical extensions and empirical investigations of resource extraction models observed data are often inconsistent with the hotelling rule suggesting that other characteristics of nonrenewable resource supply including exploration heterogeneous ore quality technological progress and capital investment are important determinants of the dynamic behavior of resource prices given the persistent recurrence of concern about nonrenewable resource scarcity measures of nonrenewable resource scarcity and the empirical evidence for the time trends of those measures are reviewed finally the implications of nonrenewable resource scarcity for economic growth are examined

crime and poverty a search theoretic approach numerous studies document that criminal activity is positively related to unemployment and negatively related to educational attainment levels within given communities we study this phenomenon in the context of a search equilibrium model in which agents choose between formal employment and pursuing crimerelated activities theft prior to their occupational choices agents undertake costly schooling raising their productivity crime acts in essence as a tax on human capital by affecting the probability that a worker s earnings possessions are subsequently appropriated there are multiple equilibria high crime low levels of educational attainment long spells of unemployment and poverty are correlated across them

impact of deposit rate ceiling changes on bank stock returns this paper reexamines the impact of four major changes in deposit rate ceilings that occurred during the 1970 80 decade on bank systematic and unsystematic risk the reexamination clarifies why it is dangerous to conduct event studies naively stephen m goldfeld and richard e quandt s switching regressions method is proposed as a procedure that forces the researcher to take a more disciplined approach to determining event dates contrary to previous studies switch dates identified by goldfeld and quandt s switching regressions method cannot be associated with ceiling change announcements because of other information flows so that inferences cannot be drawn about the specific effects of the regulatory adjustments copyright 1989 by ohio state university press

education work and crime a human capital approach this article develops a model of crime in which human capital increases the opportunity cost of crime from foregone work and expected costs associated with incarceration older more intelligent and more educated adults should commit fewer street unskilled crimes white collar crimes decline less or increase with age and education predictions for age crime and education crime relationships receive broad empirical support in self report data from the national longitudinal survey of youth and arrest data from the uniform crime reports the effects of education training and wage subsidies as well as enforcement policies on criminal behavior are discussed

crime rates and local labor market opportunities in the united states 1979 1997 the labor market prospects of young unskilled men fell dramatically in the 1980s and improved in the 1990s crime rates show a reverse pattern increasing during the 1980s and falling in the 1990s because young unskilled men commit most crime this paper seeks to establish a causal relationship between the two trends previous work on the relationship between labor markets and crime focused mainly on the relationship between the unemployment rate and crime and found inconclusive results in contrast this paper examines the impact of both wages and unemployment on crime and uses instrumental variables to establish causality we conclude that both wages and unemployment are significantly related to crime but that wages played a larger role in the crime trends over the last few decades these results are robust to the inclusion of deterrence variables controls for simultaneity and controlling for individual and family characteristics

street crime and street culture a model shows how reputation concerns can support widespread street crime a street culture where the direct incentives for such behavior are weak there are social benefits to street reputations but those benefits are dominated when reputation concerns draw into crime those who obtain no direct gain from it the model matches facts about violent crime that a standard model cannot easily explain including low monetary returns disproportionate victimization of the young and poor and high variance in rates across small distances the model generates novel implications for policy and social science including a negative effect of social capital

an on the job search model of crime inequality and unemployment we extend simple search models of crime unemployment and inequality to incorporate on the job search this is valuable because although simple models are useful on the job search models are more interesting theoretically and more relevant empirically we characterize the wage distribution unemployment rate and crime rate theoretically and use quantitative methods to illustrate key results for example we find that increasing the unemployment insurance replacement rate from 53 to 65 percent increases unemployment and crime rates from 10 and 2 7 percent to 14 and 5 2 percent we show multiple equilibria arise for some fairly reasonable parameters in one case unemployment can be 6 or 23 percent and crime 0 or 10 percent depending on the equilibrium

duopoly in exhaustible resource exploration and extraction strategic considerations of exploration and extraction are investigated in a two player two period two stage perfect equilibrium framework relative to two plant monopoly the duopolists explore more and extract more period by period a mixed game in which there is co operation upstream in exploration and cournot competition down stream in quantitites extracted is investigated we also note that increasing returns to scale in exploration can introduce an unstable solution with a corner solution the presumed stable equilibrium

a new test of the relationship between regulatory change in financial markets and the stability of beta risk of depository institutions the us economy experienced major regulatory changes in the banking and finance industry with the passage of five major acts over the period 1980 to 1991 this has generated an extensive literature investigating the effects of these changes on the us banking industry in particular this body of research has examined the share market reaction to regulatory changes as well as their impact on the risk return market value and profitability of banking industry stocks generally it has been found that the regulatory changes have had a substantial impact although the effect has not been uniform across all depository institutions this paper extends this literature by analysing the stability of a sample of eighteen us banking industry stock betas across five periods a pre regulatory change period a monetary experiment period a deregulation period a reregulation period and a post regulatory change period based on an analysis of weekly returns we find that the level of bank risk has increased further we also find a tendency towards greater beta instability in both the monetary experiment and deregulation samples the degree of beta instability is lowest in the pre regulatory change and post regulatory change samples overall the monetary experiment and regulatory change coincided with an increased tendency towards beta instability we also compare our results to a randomly selected control sample of non banks and find some more general effects of regulatory change on individual stock betas

measuring resource scarcity in non renewable resource with an application to oil and natural gas in alberta in this paper annual canadian exploration data are used to estimate a multiple output translog exploration cost function a new definition of depletion is introduced and its estimated coefficient is found to be statistically significant the fitted cost function parameters are then used to obtain estimates of the marginal costs of exploration for oil and gas our estimated marginal exploration costs are smaller than in previour studies because we have allowed for technical progress which offsets the depletion effects these marginal cost estimates are employed along with previous estimates of exploration rents to measure resource scarcity we find some evidence for the increased scarcity of oil and gas in alberta for oil there is a 10 1 per year increase in scarcity along the trend line while for natural gas there is a 2 4 per year increase in scarcity along the trend line

what accounts for the decline in crime in this article we analyze recent trends in aggregate property crime rates in the united states we propose a dynamic equilibrium model that guides our quantitative investigation of the major determinants of observed patterns of crime our main findings can be summarized as follows first the model is capable of reproducing the drop in crime between 1980 and 1996 second the most important factors that account for the observed decline in property crime are the higher apprehension probability the stronger economy and the aging of the population third the effect of unemployment on crime is negligible fourth the increased inequality prevented an even larger decline in crime overall our analysis can account for the behavior of the time series of property crime rates over the past quarter century

endogenous taxes in a vertically integrated natural resource extracting firm abstract contingent time varying taxes depend on variables internal to the industry or firm the petroleum extraction industry includes three technologically different activities exploration development and production a vertically integrated petroleum extracting firm is modelled to study an endogenous profits tax which varies with the level of proved reserves the analysis shows that the traditional measure of scarcity marginal user cost is not accurate and that the endogenous tax exaggerates the correct measure of scarcity

commodity price stabilization in imperfect or cartelized markets most studies of commodity price stabilization assume that all agents behave competitively however many commodities suitable for stockpiling are produced by countries with a significant share of the world market and commodity agreements themselves often result in cartelization of the market the paper explores the consequences of market power for the choice of storage rule and the degree of price stabilization it finds that with linear demand dominant producers choose more stable prices than under perfect competition and price stability increases with their market share with constant elastic demand the competitive degree of price stabilization is achieved

a note on the stock market effects of the adoption of risk based capital requirements on international banks in different countries abstract the present note provides empirical evidence on the relative competitive effects of the adoption of risk based capital requirements on large international banks in the u s canada u k and japan a two index regression model is used to calculate prediction errors in periods with numerous announcements concerning the new capital rules including the basle conference we find significant declines in equity returns for u s canadian and u k banks in response to news announcements with u s bank stocks exhibiting the largest negative reaction for japanese banks the equity return results are mixed which may be due to uncertainty among investors regarding the handling of their sizeable hidden reserves under the new risk adjusted capital rules

crime and social interactions the high variance of crime rates across time and space is one of the oldest puzzles in the social sciences this variance appears too high to be explained by changes in the exogenous costs and benefits of crime we present a model where social interactions create enough covariance across individuals to explain the high cross city variance of crime rates this model provides an index of social interactions which suggests that the amount of social interactions is highest in petty crimes moderate in more serious crimes and almost negligible in murder and rape

exploration and scarcity noting that a suggested measure of natural resource scarcity resource rent is unobservable we show that rent is linked to observable marginal exploration cost a two period model of extraction and exploration reveals that rent is equal to this cost when discovery is certain under risky exploration cost data can be used to bound rent the model also indicates how exploration uncertainty affects the competitive firm s extraction and exploration decisions finally the behavior of u s oil and gas exploration costs suggests that these costs were rising in the postwar era which has different implications for scarcity than indicated by other measures of scarcity

commodity price volatility with endogenous natural resources abstract natural resource reserves are exogenous in models of small commodity exporters changes in the stock of reserves play no role in the macroeconomy including in business cycle volatility trade dynamics or exchange rate volatility we consider richer supply dynamics and model exploration and depletion we show that an endogenous supply of reserves is important for capturing the stylised facts associated with commodity price shocks including a commodity currency the crowding out of non commodity activity dutch disease and a volatile business cycle we also consider how exploration and depletion affect the ranking of optimal monetary and taxation policies when natural resource reserves are held fixed monetary policy is an efficient tool for stabilising the effects of commodity price shocks however when exploration and depletion are accounted for using interest rates to stabilise the effects of commodity price changes becomes inefficient using taxes on the resource sector specifically an ad valorem royalty remains efficient

organized crime or individual crime endogenous size of a criminal organization and the optimal law enforcement i introduction organized criminal activities have been regarded as major economic and social issues since the early 1900s although there has been as pointed out by fiorentini and peltzman 1995 enormous research interest in the economics of criminal activities economists have done relatively little work on issues specifically related to the economics of organized crime we only see that much of the work has been done by following becker s 1968 framework where the target is the individual agent s allocative choice between legal and illegal activities in the face of different deterrence arrangements among the few exceptions a criminal organization is often thought of as a monopolistic firm and the theory of monopoly is predominantly used to analyze organized crimes schelling 1967 buchanan 1973 backhaus 1979 gambetta and reuter 1995 and more recently garoupa 2000 investigate the optimal public policy toward organized crimes through a welfare comparison between a monopoly organized criminals and competitive supplies individual criminals given that criminal activities are seen as social bads the monopolistic market is considered to be better than a perfectly competitive one because its output of crime is smaller 1 the monopolistic model implies that potential offenders have no other criminal choices but are forced to join the criminal organization if they decide to commit a crime clearly it is less than exhaustive in terms of describing agents choices in relation to criminal behavior in fact the criminal organization may not be monopolistic after all as argued by dick 1995 and others 2 criminologists johnson 1962 rubin 1973 and reiss 1986 observe that most criminal organizations are endemic in some particular areas and or restrictive in some particular illegal businesses these criminal activities such as bootlegging drug dealing pimping and prostitution are often less organized and would be difficult to successfully monopolize dick 1995 also points out that prostitution smuggling fencing and narcotics importation often involve substantial competition among downstream suppliers and can hardly be regarded as monopolistic businesses in other similar studies klein and crawford 1967 morash 1983 and sarnecki 1986 conclude that most youths who engage in delinquency are at most street gangsters and cannot be seen as members of a highly structured organization in reality the determination of the market structure for crime should be endogenous which has notable implications for the optimal crime enforcement policies and crime itself to recover the conventionally neglected facts and provide a more complete picture regarding organized crime this article develops a simple but more general model in this framework individual and organized crimes are coexisting alternatives to a potential offender and joining a criminal organization is seen as only one of the agent s rational choices in deciding whether to join a criminal organization the methods used to allocate the criminal organization s payoffs and the extra benefits provided by the criminal organization are given serious consideration they both play crucial roles in determining the sizes of the criminal organizations as well as in influencing the interactive relationship between the market structure for crime and the government s optimal law enforcement this study contributes to the existing literature and provides new insights in three respects first of all by allowing the agent to choose rationally between engaging in individual or organized crime we not only endogenize the size of the criminal organization but also explore the factors that determine the type high or low criminal ability of offenders that enter the criminal organization a new theoretical attempt is made in terms of providing an explanation to the observation of anderson 1995 there are considerable variations in personal qualities and values across different criminal organizations

the economics of organized crime and optimal law enforcement this article extends the optimal law enforcement literature to organized crime i model the criminal organization as a vertical structure where the principal extracts some rents from the agents through extortion as long as extortion is a costless transfer from individuals to the criminal organization not only the existence of extortion is social welfare improving because it makes engaging in a criminal offense less attractive but it also allows the government to reduce expenditures on law enforcement when extortion is costly because the criminal organization resorts to threats and violence the existence of extortion is social welfare diminishing and may lead to higher expenditures on law enforcement

crime inequality and unemployment there is much discussion of the relationships between crime inequality and unemployment we construct a model where all three are endogenous we find that introducing crime into otherwise standard models of labor markets has several interesting implications for example it can lead to wage inequality among homogeneous workers also it can generate multiple equilibria in natural but previously unexplored ways hence two identical neighborhoods can end up with different levels of crime inequality and unemployment we discuss the effects of anti crime policies like changing jail sentences as well as more traditional labor market policies like changing unemployment insurance this abstract was borrowed from another version of this item

search for a theory of organized crimes abstract casual empirical observations reveal no systematic relationship between the overall crime rate and organized criminal activity we develop a search theoretic framework to study the interactions not only between formal labor and crime sectors but also between individual and organized crimes in equilibrium individual and organized criminals face different arrest risks success rates reward structures and outside options we characterize agents occupational choices the gang s hierarchical structure and the responses of unemployment crime rates and crime composition to changes in labor market conditions and crime deterrence policies we further assess the effectiveness of arrest versus punishment policies in deterring individual and organized crimes

the brady plan the 1989 mexican debt reduction agreement and bank stock returns in the united states and japan the authors investigate the impact of the menu approach to debt rescheduling on the market value of two major creditors u s and japanese banks they try to understand how major creditor banks are affected by debt reschedulings and the menu choices they make so that debt deals can be structured in a way that appeals to both creditors and debtor countries they measure the stock market s reaction to the announcement of the brady plan and the mexican debt reduction agreement the brady plan was implemented through the menu approach which acknowledges creditor heterogeneity and provides financing packages that meet the country s financing requirements while still allowing the banks to reduce their exposure the mexican agreement provides an opportunity to test the impact of the brady plan s implementation by examining individual bank s menu choices exposure levels and the market s reaction they explore whether banks were able to make optimal portfolio choices when confronted with the obligation to participate they show that stock prices for different groups of banks reacted quite differently to focal events among all banks u s multinationals showed the strongest positive reaction to the brady announcement and the mexican agreement u s non multinationals do not appear to have been significantly affected by these international debt related events the reaction experienced by all japanese banks was much weaker than that of u s multinationals and was negative for the brady announcement and the initial mexico announcement the authors contend that the lack of a strong reaction was because of the japanese banks relatively low exposure to developing country risk they see the negative market reaction as a reflection of the expectation that a u s initiated debt reduction strategy would not be favorable for japanese banks indeed after the menu choices were announced the market recognized that the japanese banks were treated fairly and corrected itself they do not find that banks that made different choices were treated differently by the market so banks were able to negotiate menu choices in their best interest and to make portfolio choices consistent with their business objectives the results here confirm that the menu approach to debt restructuring may benefit both the creditor banks and the debtor countries

strong and weak ties in employment and crime this paper analyzes the interplay between social structure and information exchange in two competing activities crime and labor we consider a dynamic model in which individuals belong to mutually exclusive two person groups referred to as dyads there are multiple equilibria if jobs are badly paid and or crime is profitable unemployment benefits have to be low enough to prevent workers for staying too long in the unemployment status because they are vulnerable to crime activities if instead jobs are well paid and or crime is not profitable unemployment benefits have to be high enough to induce workers to stay unemployed rather to commit crime because they are less vulnerable to crime activities also in segregated neighborhoods characterized by high interactions between peers a policy only based on punishment and arrest will not be efficient in reducing crime it has to be accompanied by other types of policies that take into account social interactions

extraction costs and the economics of nonrenewable resources the study questions the fundamental assumption of the standard aggregate exploration extraction model of nonrenewable resources that extraction costs and the level of reserves are inversely related it also raises questions about the model s conclusions regarding exploration incentives and the valuation of reserves an empirically tested disaggregate model is presented that suggests that exploration activity occurs from firms attempting to balance marginal extraction plus user costs at the intensive and extensive margins exploration is carried out until the marginal discovery cost of a deposit equals its present asset value and a u shaped price path is indicated

crime and the labor market a search model with optimal contracts abstract this paper extends the pissarides pissarides christopher a equilibrium unemployment theory cambridge mit 2000 model of the labor market to include crime and punishment a la becker becker gary s crime and punishment an economic approach journal of political economy 76 1968 169 217 all workers irrespective of their labor force status can commit crimes and the employment contract is determined optimally the model is used to study analytically and quantitatively the effects of various labor market and crime policies for instance a more generous unemployment insurance system reduces the crime rate of the unemployed but its effect on the crime rate of the employed depends on job duration and jail sentences when the model is calibrated to u s data the overall effect is to decrease crime but is quantitatively small small wage subsidies reduce unemployment and crime rates of employed and unemployed workers and raise society s welfare hiring subsidies reduce unemployment but they can raise the crime rate of employed workers crime policies police technology and jail sentences affect crime rates significantly but have only negligible effects on the labor market

the time path of scarcity rent in the theory of exhaustible resources there is now a consensus in the literature on resource economics that a depletable resource should command a price in excess of its marginal extraction cost simply to reflect the opportunity cost of using a unit of it today rather that conserving it for the future but how this excess is to change along an optimal or competitive equilibrium path of resource use is still an unresolved question this might at first seem puzzling since according to the fundamental theorem of economics of exhaustible resources or hotelling i 93 i rule on an optimal path price minus marginal extraction cost also termed interchangeably as scarcity rent user cost or royalty should steadily grow over time at the social rate of discount however the literature contains sharply contrasting views on the subject for example kay and mirrlees 1975 have argued that since along an optimal path the scarcity rent grows exponentially as a finite stock of a resourcexnears exhaustion then situations in which the resource stock is still very large and yet the price greatly exceeds the marginal extraction cost should indicate that the price is significantly above its optimal level and that the resource is overconserved in stark contrast to this view heal i976 has argued that as the resource stock nears exhaustion the difference between price and marginal cost or what he termed social cost of extraction falls monotonically to zero hanson i980 analyses the same model as heal s but unlike heal who assumes the unit extraction cost to be convex he postulates it to be concave and yet like heal concludes that the scarcity rent will be monotonically declining over time solow and wan i976 analyse a still different situation where resource deposits differ in quality and the unit extraction cost increases as higher grade deposits are exhausted and extraction proceeds to lower grades they show that along an optimal path the shadow price of a resource must rise at the real rate of interest despite differential extraction costs but that the difference between price and the marginal extraction cost or what they call degradation charge declines monotonically over time to zero these sharply differing conclusions suggest that far from being resolved the question of how scarcity rent changes over time is much in want of a close scrutiny the need for such a scrutiny becomes even stronger once it is noted

estimates of marginal discovery costs for oil and gas previous estimates of the finding costs for oil and natural gas reserves have been impeded by the joint cost problem in exploration the solutions have been either to estimate the finding cost for an oil gas aggregate or to allocate total finding costs between oil discoveries and gas discoveries according to rules chosen by the researcher in this paper the joint cost problem is circumvented by estimating a multiple output exploration cost function which is used to calculate the predicted values of marginal finding costs for oil and gas these values are then compared with independent estimates of the shadow prices of reserves for oil and gas to help settle the debate over whether marginal finding costs provide a good measure of rent

didmca and bank market risk theory and evidence abstract this paper examines the theoretical and empirical consequences of the depository institutions deregulation and monetary control act of 1980 on the market risk of the us banking industry we survey several theoretical arguments linking deregulation of deposit interest rates to market based measures of bank risk capital market data for a sample of large commercial bank holding companies provides evidence that deregulation has accompanied increases in both systematic and nonsystematic measures of bank risk

the economics of exploration for non renewable resources abstract the literature on exploration for non renewable resources is surveyed following a brief synopsis in section 2 section 3 focuses on issues related to the world market for resources section 4 considers more microeconomic supply related issues linked to the exploration of the small region or play section 5 turns to the small but growing literature on exploration as a learning process related to r d the latter sections pay particular attention to empirical and policy aspects

carrots sticks and broken windows abstract this paper investigates the effect of economic conditions carrots and sanctions sticks on murder assault robbery burglary motor vehicle theft grand larceny and rape in new york city using monthly time series data spanning 1974 99 carrots are measured by the unemployment rate and the real minimum wage sticks are measured by the number of felony arrests size of the police force and number of new york city residents in prison in addition the paper tests the validity of the broken windows hypothesis consistent with its implementation by the new york police department we use misdemeanor arrests as a measure of broken windows policing the broken windows hypothesis has validity in the case of robbery motor vehicle theft and grand larceny while both economic and deterrence variables are important in explaining the decline in crime the contribution of deterrence measures is larger than those of economic variables

wealth effects of foreign expansion by u s banks abstract the effects of foreign expansion on the market values of u s banks usbs are examined in this study the results show that shareholders of usbs experience significant abnormal returns of 0 17 percent when banks announce foreign expansions abnormal returns are insignificant when the announced mode of expansion is through a representative office are significantly positive for announcements related to branches and are significantly negative when the announced mode of expansion is through formation of a joint venture or a subsidiary or through an acquisition abnormal returns are significantly negative when banks announce expansion into developed countries and are significantly positive when announcements relate to risky developing countries post announcement changes in the total variance of returns and in the unsystematic risk of usbs are inversely related with abnormal returns higher wealth effects are associated with higher levels of prior overseas experience

on measuring natural resource scarcity conclusions concerning trends in natural resource scarcity may depend critically on the choice of scarcity index unfortunately the prevalence of vertical integration in natural resource industries has hindered the use of some otherwise desirable scarcity measures in this paper duality theory is used to derive an econometric procedure for estimating one such measure the shadow price of the resource in situ empirical results for the canadian metal mining industry indicate that resource scarcity as measured by this shadow price has decreased substantially over time

deposit insurance and wealth effects the value of being too big to fail this paper investigates the effect on bank equity values of the comptroller of the currency s announcement that some banks were too big to fail and that for those banks total deposit insurance would be provided using an event study methodology we find positive wealth effects accruing to tbtf banks with corresponding negative effects accruing to non included banks we demonstrate that the magnitude of these effects differed with bank solvency and size we also show that the policy to which the market reacted was that suggested by the wall street journal and not that actually intended by the comptroller the role of deposit insurance has become a topic of increasing debate advocates argue that by removing the incentive to run deposit insurance protects individual financial institutions from instability in the intermediation process thereby providing stability to the financial system as a whole 1 the recent rise in bank failures and the concomitant crises in the s l industry however demonstrate that this stability is not guaranteed moreover critics note that deposit insurance may introduce incentive problems and wealth effects into the financial system both of which can impede the effective functioning of any deposit insurance system these problems have prompted concern about the structure of the current deposit insurance system and have led to numerous proposals regarding its restructuring 2 this paper investigates one aspect of this debate by analyzing the effect on bank equity values of the policy decision to insure completely some banks but not others specifically in september 1984 the comptroller of the currency testified before congress that some banks were simply too big to fail tbtf and that for those banks total deposit insurance would be provided while not explicitly naming the banks the comptroller admitted that this policy would apply to the eleven largest banks using an event study methodology we analyze