Institutional Causes of the Global Banking Crisis and the Emergence of Macro-Prudential Countercyclical Policy

Andrzej Sławiński ()
Additional contact information
Andrzej Sławiński: Warsaw School of Economics, Poland

Chapter 1 in Acta Universitatis Lodziensis. Folia Oeconomica nr 295/2013 - Financial Markets and Macroprudential Policy, 2013, vol. 295, pp 7-24 from University of Lodz

Abstract: The recent global banking crisis was caused by an intertwined process consisting of the emergence of universal financial conglomerates, the development of global interbank money markets, and of regulatory capture leading to an excessively libertarian approach to financial regulation and supervision. All these factors produced the three main sources of risks that brought about the global banking crisis, namely, enhanced credit pro-cyclicality, banks’ interconnectedness, and their growing exposure to balance sheet losses. The experiences with unsustainable lending booms of the previous decade showed that stabilizing inflation is not sufficient to stabilize the economy. These experiences underscore that macro-prudential policy should be a second weapon in central banks’ countercyclical policy arsenal.

Keywords: Global banking crisis; Regulation and supervision; Macro-prudential policy (search for similar items in EconPapers)
JEL-codes: C01 E02 F00 G00 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://dspace.uni.lodz.pl/xmlui/handle/11089/10541 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ann:findec:book:y:2013:n:295:ch:01:foe

Access Statistics for this chapter

More chapters in FindEcon Chapters: Forecasting Financial Markets and Economic Decision-Making from University of Lodz Contact information at EDIRC.
Bibliographic data for series maintained by Piotr Wdowiński ().