The Failure of Silicon Valley Bank and the Panic of 2023
Journal of Economic Perspectives
vol. 38,
no. 1, Winter 2024
(pp. 133-52)
(Complimentary)
Abstract
The failure of Silicon Valley Bank on March 10, 2023 brought attention to significant weaknesses across the banking system, leading to a panic that spread to other vulnerable banks. With subsequent failures of Signature Bank and First Republic Bank, the United States had three of the four largest bank failures in its history occur over a two-month period. Several features of the Silicon Valley Bank failure make it an ideal teaching case for explaining the underlying economics of banking (in general) and banking crises (specifically). This paper tries to do that.Citation
Metrick, Andrew. 2024. "The Failure of Silicon Valley Bank and the Panic of 2023." Journal of Economic Perspectives, 38 (1): 133-52. DOI: 10.1257/jep.38.1.133Additional Materials
JEL Classification
- G01 Financial Crises
- G21 Banks; Depository Institutions; Micro Finance Institutions; Mortgages
- G28 Financial Institutions and Services: Government Policy and Regulation
- G33 Bankruptcy; Liquidation
- I12 Health Behavior
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