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The Regulatory Responses to the Global Financial Crisis :, Some Uncomfortable Questions, Stijn Claessens, Laura Kodres

We identify current challenges for creating stable, yet efficient financial systems using lessons from recent and past crises. Reforms need to start from three tenets: adopting a system-wide perspective explicitly aimed at addressing market failures; understanding and incorporating into regulations agents’ incentives so as to align them better with societies’ goals; and acknowledging that risks of crises will always remain, in part due to (unknown) unknowns – be they tipping points, fault lines, or spillovers. Corresponding to these three tenets, specific areas for further reforms are identified. Policy makers need to resist, however, fine-tuning regulations: a “do not harm” approach is often preferable. And as risks will remain, crisis management needs to be made an integral part of system design, not relegated to improvisation after the fact
Table Of Contents
Cover; Abstract; Contents; I. Introduction; II. What caused the global financial crisis? And what is the state of affairs of reform?; A. Common causes; B. New causes; C. Regulatory responses to date: Where are we now?; III. Why haven't we made more progress? An analytical framing; A. Think system-wide and address market failures and externalities.; B. Improve incentives; C. Realize risks, known and unknown, will remain; D. Adapt approaches and avoid fallacies; Box; 1. Overall Approaches to Determine Specific Reforms; IV. Some reforms to achieve global financial stability
Literary Form
non fiction
Description based upon print version of record
Physical Description
1 online resource (40 p.)
Specific Material Designation
Form Of Item

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