Title: Safety-net benefits conferred on difficult-to-fail-and-unwind banks in the us and eu before and during the great recession
Description: "This paper models and estimates ex ante safety-net benefits at a sample of large banks in US and Europe during 2003-2008.  Our results suggest that difficult-to-fail and unwind (DFU) banks enjoyed substantially higher ex ante benefits than other institutions.  Safety-net benefits prove significantly larger for DFU firms in Europe and bailout decisions less driven by asset size than in the US.  We also find that a proxy for regulatory capture helps to explain bailout decisions in Europe.  A policy implication of our findings is that authorities could better contain safety-net benefits if they refocused their information systems on measuring volatility as well as capital"--National Bureau of Economic Research web site.