The contribution of wealth concentration to the subprime crisis: a quantitative estimation

The crisis that broke out in mid-2007 was caused by the fact that the collateralised debt obligation (CDO) market had grown to a size sufficient to wreak general havoc when it suddenly collapsed. Several authors have argued that economic inequality was important to the growth of this market. This pa...

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Autores:
Goda, Thomas
Lysandrou, Photis
Tipo de recurso:
Fecha de publicación:
2014
Institución:
Universidad EAFIT
Repositorio:
Repositorio EAFIT
Idioma:
eng
OAI Identifier:
oai:repository.eafit.edu.co:10784/7523
Acceso en línea:
http://hdl.handle.net/10784/7523
Palabra clave:
Wealth concentration
Income inequality
CDOs
Subprime crisis
Bond yields
Rights
License
restrictedAccess
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oai_identifier_str oai:repository.eafit.edu.co:10784/7523
network_acronym_str REPOEAFIT2
network_name_str Repositorio EAFIT
repository_id_str
spelling 2014-03-032015-11-06T16:24:59Z2014-03-032015-11-06T16:24:59Z0309-166Xhttp://hdl.handle.net/10784/752310.1093/cje/bet061The crisis that broke out in mid-2007 was caused by the fact that the collateralised debt obligation (CDO) market had grown to a size sufficient to wreak general havoc when it suddenly collapsed. Several authors have argued that economic inequality was important to the growth of this market. This paper attempts to strengthen this argument by concentrating attention on global wealth concentration. After summarising recent evidence on the negative impact of investor demand on US bond yields in the pre-crisis period, new evidence regarding the specific contribution of high-net-worth individuals to this negative impact is presented. The paper then goes on to show how, after having helped to cause a yield problem in the major US debt markets, high-net-worth individuals (via hedge funds) continued to be a major source of the pressure on US banks to resolve this yield problem through the mass production of CDOs.engOxford University Press on behalf of the Cambridge Political Economy Society.Cambridge Journal of Economics. Vol.38(2), 2014, pp.157-182http://cje.oxfordjournals.org/content/early/2013/12/03/cje.bet061.shorthttp://cje.oxfordjournals.org/content/early/2013/12/03/cje.bet061.shortrestrictedAccess© The Author 2013. Published by Oxford University Press on behalf of the Cambridge Political Economy Society. All rights reserved.Acceso restringidohttp://purl.org/coar/access_right/c_16ecCambridge Journal of Economics. Vol.38(2), 2014, pp.157-182The contribution of wealth concentration to the subprime crisis: a quantitative estimationarticleinfo:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionArtículoObra publicadapublishedVersionhttp://purl.org/coar/version/c_970fb48d4fbd8a85http://purl.org/coar/resource_type/c_6501http://purl.org/coar/resource_type/c_2df8fbb1Wealth concentrationIncome inequalityCDOsSubprime crisisBond yieldsEscuela de Economía y FinanzasEconomíaGoda, ThomasLysandrou, PhotisUniversidad EAFIT, ColombiaCity University and School of Oriental and African Studies (SOAS), UKEstudios en Economía y EmpresaCambridge Journal of Economics38215718210784/7523oai:repository.eafit.edu.co:10784/75232015-11-06 16:35:25.045metadata.onlyhttps://repository.eafit.edu.coRepositorio Institucional Universidad EAFITrepositorio@eafit.edu.co
dc.title.eng.fl_str_mv The contribution of wealth concentration to the subprime crisis: a quantitative estimation
title The contribution of wealth concentration to the subprime crisis: a quantitative estimation
spellingShingle The contribution of wealth concentration to the subprime crisis: a quantitative estimation
Wealth concentration
Income inequality
CDOs
Subprime crisis
Bond yields
title_short The contribution of wealth concentration to the subprime crisis: a quantitative estimation
title_full The contribution of wealth concentration to the subprime crisis: a quantitative estimation
title_fullStr The contribution of wealth concentration to the subprime crisis: a quantitative estimation
title_full_unstemmed The contribution of wealth concentration to the subprime crisis: a quantitative estimation
title_sort The contribution of wealth concentration to the subprime crisis: a quantitative estimation
dc.creator.fl_str_mv Goda, Thomas
Lysandrou, Photis
dc.contributor.department.spa.fl_str_mv Escuela de Economía y Finanzas
Economía
dc.contributor.author.spa.fl_str_mv Goda, Thomas
Lysandrou, Photis
dc.contributor.affiliation.spa.fl_str_mv Universidad EAFIT, Colombia
City University and School of Oriental and African Studies (SOAS), UK
dc.contributor.program.spa.fl_str_mv Estudios en Economía y Empresa
dc.subject.keyword.eng.fl_str_mv Wealth concentration
Income inequality
CDOs
Subprime crisis
Bond yields
topic Wealth concentration
Income inequality
CDOs
Subprime crisis
Bond yields
description The crisis that broke out in mid-2007 was caused by the fact that the collateralised debt obligation (CDO) market had grown to a size sufficient to wreak general havoc when it suddenly collapsed. Several authors have argued that economic inequality was important to the growth of this market. This paper attempts to strengthen this argument by concentrating attention on global wealth concentration. After summarising recent evidence on the negative impact of investor demand on US bond yields in the pre-crisis period, new evidence regarding the specific contribution of high-net-worth individuals to this negative impact is presented. The paper then goes on to show how, after having helped to cause a yield problem in the major US debt markets, high-net-worth individuals (via hedge funds) continued to be a major source of the pressure on US banks to resolve this yield problem through the mass production of CDOs.
publishDate 2014
dc.date.issued.none.fl_str_mv 2014-03-03
dc.date.available.none.fl_str_mv 2015-11-06T16:24:59Z
dc.date.accessioned.none.fl_str_mv 2015-11-06T16:24:59Z
dc.date.none.fl_str_mv 2014-03-03
dc.type.eng.fl_str_mv article
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
dc.type.coarversion.fl_str_mv http://purl.org/coar/version/c_970fb48d4fbd8a85
dc.type.coar.fl_str_mv http://purl.org/coar/resource_type/c_6501
http://purl.org/coar/resource_type/c_2df8fbb1
dc.type.local.spa.fl_str_mv Artículo
dc.type.hasVersion.spa.fl_str_mv Obra publicada
dc.type.hasVersion.eng.fl_str_mv publishedVersion
status_str publishedVersion
dc.identifier.issn.none.fl_str_mv 0309-166X
dc.identifier.uri.none.fl_str_mv http://hdl.handle.net/10784/7523
dc.identifier.doi.none.fl_str_mv 10.1093/cje/bet061
identifier_str_mv 0309-166X
10.1093/cje/bet061
url http://hdl.handle.net/10784/7523
dc.language.iso.eng.fl_str_mv eng
language eng
dc.relation.ispartof.spa.fl_str_mv Cambridge Journal of Economics. Vol.38(2), 2014, pp.157-182
dc.relation.isversionof.none.fl_str_mv http://cje.oxfordjournals.org/content/early/2013/12/03/cje.bet061.short
dc.relation.uri.none.fl_str_mv http://cje.oxfordjournals.org/content/early/2013/12/03/cje.bet061.short
dc.rights.eng.fl_str_mv restrictedAccess
dc.rights.coar.fl_str_mv http://purl.org/coar/access_right/c_16ec
dc.rights.local.spa.fl_str_mv Acceso restringido
rights_invalid_str_mv restrictedAccess
Acceso restringido
http://purl.org/coar/access_right/c_16ec
dc.publisher.eng.fl_str_mv Oxford University Press on behalf of the Cambridge Political Economy Society.
dc.source.spa.fl_str_mv Cambridge Journal of Economics. Vol.38(2), 2014, pp.157-182
institution Universidad EAFIT
repository.name.fl_str_mv Repositorio Institucional Universidad EAFIT
repository.mail.fl_str_mv repositorio@eafit.edu.co
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