01696cas a2200241 a 4500 AALejournalIMF018610 230101c9999 xx r poo 0 0eng d 5.00 USD 9781484364024 1018-5941 BD-DhAAL BD-DhAAL Xiaochen Feng, Alan. Bank Competition, Risk Taking, and their Consequences : Evidence from the U.S. Mortgage and Labor Markets / Alan Xiaochen Feng. Washington, D.C. : International Monetary Fund, 2018. 1 online resource (46 pages) IMF Working Papers <strong>Off-Campus Access:</strong> No User ID or Password Required <strong>On-Campus Access:</strong> No User ID or Password Required Electronic access restricted to authorized BRAC University faculty, staff and students Bank competition can induce excessive risk taking due to risk shifting. This paper tests this hypothesis using micro-level U.S. mortgage data by exploiting the exogenous variation in local house price volatility. The paper finds that, in response to high expected house price volatility, banks in U.S. counties with a competitive mortgage market lowered lending standards by twice as much as those with concentrated markets between 2000 and 2005. Such risk taking pattern was associated with real economic outcomes during the financial crisis, including higher unemployment rates in local real sectors. Mode of access: Internet IMF Working Papers; Working Paper ; No. 2018/157 Full text available on IMF http://elibrary.imf.org/view/journals/001/2018/157/001.2018.issue-157-en.xml IMF e-Library