EconPapers    
Economics at your fingertips  
 

Global Financial Safety Nets: Where Do We Go from Here?

Eduardo Fernandez-Arias and Eduardo Levy Yeyati ()

No 3166, IDB Publications (Working Papers) from Inter-American Development Bank

Abstract: An analysis of the performance of the global financial safety net during the 2008-2009 crisis, and an evaluation of its new components, indicates that, from an emerging markets perspective, the net remains full of holes despite recent stitches. This paper therefore proposes an effective and workable international lender of last resort (ILLR) for systemic liquidity crises based on: i) an automatic trigger to access the facility; ii) unilateral country pre-qualification to the facility during Article IV consultations; and iii) liquidity funded by the world's "issuers of last resort". These principles would support a reliable and broad-based ILLR without the carrying costs associated with inefficient reserve hoarding, which would actually work as an effective preventive facility with minimal room for moral hazard.

Keywords: Liquidity Crisis; International Lender of Last Resort; Safety Net (search for similar items in EconPapers)
Date: 2011-09
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Downloads: (external link)
https://publications.iadb.org/publications/english ... -We-Go-from-Here.pdf (application/pdf)

Related works:
Journal Article: Global Financial Safety Nets: Where Do We Go from Here? (2012) Downloads
Working Paper: Global Financial Safety Nets: Where Do We Go from Here? (2010) Downloads
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:idb:brikps:3166

Access Statistics for this paper

More papers in IDB Publications (Working Papers) from Inter-American Development Bank Contact information at EDIRC.
Bibliographic data for series maintained by Felipe Herrera Library ().

 
Page updated 2022-12-05
Handle: RePEc:idb:brikps:3166