The side effects of national financial sector policies: framing the debate on financial protectionism

Roland Beck, Dennis Reinhardt, Cyril Rebillard, Julio Ramos-Tallada (), Jolanda Peeters, Francesco Paternò, Julia Wörz, John Beirne and Lisa Weissenseel
Authors registered in the RePEc Author Service: Julia Maria Woerz ()

No 166, Occasional Paper Series from European Central Bank

Abstract: The decrease of financial integration both at the global and European level reflects, to a certain extent, a market response to the crisis. It might, however, also be partly driven by policies such as capital flow management measures (CFMs). In addition, several other measures taken by central banks, regulators and governments in response to the crisis may have had less obvious negative side effects on financial integration. Against this backdrop, this paper explores broad definitions of financial protectionism in order to raise awareness of the fact that the range of policies which could negatively affect financial integration may be much wider than residency-based CFMs. At the same time, the paper acknowledges that these measures have mostly been taken for legitimate financial stability purposes and with no protectionist intentions. The paper considers five categories of policy measures which could contribute to financial fragmentation both at the global and at the EU level: currency-based measures directed towards banks, geographic ring fencing, some financial repression policies, crisis resolution policies with a national bias, and some financial sector taxes. JEL Classification: F36, F42, F62

Keywords: capital controls; financial integration; financial protectionism; macro-prudential policy (search for similar items in EconPapers)
Date: 2015-09
Note: 597822
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

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