Dr. Maylis Avaro

My expertise lies at the intersection of monetary history, banking history and international political economy and. The overarching aim of my work is to understand the forces that shape the economic and geopolitical landscape.

One part of my research examines the history of the banking sector, its regulation, and its stabilization. In a project with Vincent Bignon (Bank of France), we focus on the trade-off faced by central banks between the distribution of liquidity to a large group of banks and the risk of moral hazard. This research directly addresses the challenges faced by the Fed after the 2023 Silicon Valley Bank collapse. In this article, currently available as a CEPR working paper, we show that the 19th-century Bank of France could expand its liquidity facility to stabilize the economy by operating a broad discount window. To shield its balance sheet from losses, the Bank employed various risk management techniques that subdued the risk-taking behaviors of its counterparties. In another project with Marc Flandreau, we study Central Bank Losses in 1931, as a mirror the losses experienced from 2022 as a result of the QE. We are currently working on the second draft of this project.

I am also interested in dynamics of the private banking sector. with Kim Oosterlinck (Université Libre de Bruxelles) and Jean Lacroix (Université Paris Saclay), we study the first national regulation of the French banking sector enforced under the Vichy regime in 1941. Despite being written under Nazi occupation of France, the regulation remained in place after the war. We combine the legal and the economic history of this episode to assess how the legal changes altered the banking landscape at both regional and national levels, and to determine whether some banks exploited this opportunity to gain a competitive advantage. We are currently working on the first draft of the paper.
My last ongoing project studies financial crisis in money markets. In a joint project with Marc Flandreau, we investigate the crash of the Terra/Luna dual currency system. To identify the main drivers of the crash of the ecosystem, we study the microeconomics of the Terra system and gather data from multiple blockchains to empirically test our hypothesis. We provide a new perspective on this event, revealing that the collapse was primarily driven by the collateral crisis in the system"s largest bank and network congestions across blockchains. In addition to my existing research agenda in monetary and financial history, I plan to continue investigating cryptoeconomics and use the lessons from history to analyze the functioning of digital currencies. We are revising our paper and working on a second draft.