Preventing Zombie Lending
由于有限责任，资不抵债的银行有动机继续向资不抵债的借款人放贷以掩盖损失和赌博式复活，这在社会上是低效的。本文提出一个监管方案，诱导银行自愿披露不良贷款，避免对股权持有人产生意外收益，并可将部分损失转嫁给债务持有人。
Because of limited liability, insolvent banks have an incentive to continue lending to insolvent borrowers, in order to hide losses and gamble for resurrection, even though this is socially inefficient. We suggest a scheme that regulators could use to solve this problem. The scheme would induce banks to reveal their bad loans, which can then be dealt with. Bank participation in the scheme would be voluntary. Even though banks have private information on the quantity of bad loans on their balance sheets, the scheme avoids creating windfall gains for bank equity holders. In addition, some losses can be imposed on debt holders.