Rafael Repullo, Professor of Economics at Center for Monetary and Financial Studies (CEMFI), will be visiting Columbia to host a two-part mini course series on the topic of “The Transmission of Monetary Policy when Banks have Market Power.” Please see the detailed information below for further course information and to RSVP.

• Part 1: Tuesday, February 25, 2025 –“The Deposits Channel of Monetary Policy: A Critical Review”
• Part 2: Thursday, February 27, 2025 -“Interest Rates, Market Power, and Financial Stability (with David Martinez-Miera)”

Abstract for Part 2:

This paper shows that banks’ market power is key to assessing the effects of safe rates on their risk-taking decisions. We consider an economy where banks have market power in lending and privately monitor loans, which reduces their probabilities of default. We show that lower safe rates lead to lower margins and higher risk-taking when banks have low market power, but the result is reversed for high market power. We show that the reversal is stronger when deposits are insured, and it is robust to introducing market power in deposits and endogenous bank leverage.

Please note that an RSVP is required to attend this event. Please click here to RSVP.

Light refreshments will be served.

Information for the first lecture in the course series (on 2/25/25) can be found here.