The Effects of Diversification on Banks? Expected Returns

Borradores de Economia
Number: 
524
Published: 
Classification JEL: 
G00, G21, G30
Keywords: 
Human capital agglomeration, Social returns, Private returns, Externalities, Uncertainty, Fiscal policy

In financial theory, the optimal allocation of assets and its relationship with profitability has been one of the main concerns; the question has always been if banks should focus or diversify their assets. In our case, we would like to answer this questi