Depositor Sentiment

75 Pages Posted: 9 Dec 2015

See all articles by Felix Irresberger

Felix Irresberger

Durham University

Gregor N. F. Weiss

University of Leipzig - Faculty of Economics and Management Science

Date Written: December 7, 2015

Abstract

We use internet search volume data to measure household sentiment and attention for deposit insurance in the U.S. to explain depositor behavior. We find market-level sentiment to cause depositors to withdraw both demand and time deposits from small and medium-sized banks and to run to big banks. By contrast, the attention of households to deposit insurance as revealed by the volume of queries related to the Federal Deposit Insurance Corporation is positively related to changes in deposits. In addition, a higher level of information procurement by households on deposit insurance mitigates the probability of drains in deposits.

Keywords: Bank runs, depositor sentiment, bank deposits, deposit insurance

JEL Classification: G21, D12

Suggested Citation

Irresberger, Felix and Weiss, Gregor N. F., Depositor Sentiment (December 7, 2015). Available at SSRN: https://ssrn.com/abstract=2532870 or http://dx.doi.org/10.2139/ssrn.2532870

Felix Irresberger

Durham University ( email )

Old Elvet
Mill Hill Lane
Durham, Durham DH1 3HP
United Kingdom

Gregor N. F. Weiss (Contact Author)

University of Leipzig - Faculty of Economics and Management Science ( email )

Grimmaische Str. 12
Leipzig, 04109
Germany
+49 341 97 33821 (Phone)
+49 341 97 33829 (Fax)

HOME PAGE: http://www.wifa.uni-leipzig.de/nfdl

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