Show simple item record

dc.contributor.authorBEAN, Charles
dc.date.accessioned2010-03-10T13:41:33Z
dc.date.available2010-03-10T13:41:33Z
dc.date.issued2010
dc.identifier.issn1830-7736
dc.identifier.urihttp://hdl.handle.net/1814/13522
dc.description.abstractThis lecture examines the causes of the recent financial crisis and subsequent recession. On the macroeconomic side, the Great Moderation encouraged an overly optimistic assessment of risk. Combined with low interest rates, reflecting both loose monetary policy and relatively high Asian savings rates, that encouraged a build-up of excessive leverage in the banking system. On the microeconomic side, distorted incentives led to a concentration and mispricing of risk. Informational complexities associated with new financial assets and the interconnectedness of financial institutions then resulted in the closure of funding markets and a flight to safety when loan defaults rose unexpectedly. The episode indicates the need to focus on agency and information problems between banks and their funders in addition to those between the banks and their borrowers. It also suggests that the process of financial intermediation should play a more prominent role in macroeconomic models.en
dc.format.mimetypeapplication/pdf
dc.language.isoenen
dc.relation.ispartofseriesEUI MWP LSen
dc.relation.ispartofseries2010/02en
dc.rightsinfo:eu-repo/semantics/openAccessen
dc.subjectGreat Moderationen
dc.subjectglobal imbalancesen
dc.subjectfinancial crisisen
dc.subjectleverageen
dc.subjectcredit boomsen
dc.subjectmacroprudential policyen
dc.subjectE32en
dc.subjectE44en
dc.subjectE52en
dc.subjectE58en
dc.subjectF32en
dc.subjectG01en
dc.subjectG21en
dc.titleThe Great Moderation, the Great Panic and the Great Contractionen
dc.typeOtheren
eui.subscribe.skiptrue


Files associated with this item

Icon

This item appears in the following Collection(s)

Show simple item record