Research ArticleOpen AccessGoogle Scholar indexed
Excess Liquidity and Bank Managers’ Remuneration: The Role of Monetary Policy
RMIT Vietnam University, Ho Chi Minh City, Vietnam
RMIT Vietnam University, Ho Chi Minh City, Vietnam
RMIT Vietnam University, Ho Chi Minh City, Vietnam
- 1 RMIT Vietnam University, Ho Chi Minh City, Vietnam
- 2 RMIT Vietnam University, Ho Chi Minh City, Vietnam
- 3 RMIT Vietnam University, Ho Chi Minh City, Vietnam
Theoretical Economics Letters·Volume 08 (2018)·Pages 2673–2681·Published 14 September 2018·DOI10.4236/tel.2018.812169
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Abstract
This paper investigates the impacts of monetary policy on bank managers’ remuneration in Vietnam and China where excess liquidity is present in the economies. The study argues that excess liquidity provides the condition to conceal risk taken by bank managers, and hence their remunerations are improved. However, the capability of excess liquidity in concealing risk is attenuated during the tightening monetary policy regime. The study extends the relationship between monetary policy and risk taking incentives of bank managers to the context of excess liquidity condition.
KeywordsExcess LiquidityRemunerationMonetary PolicyEmerging Markets
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