Date: 2013
Type: Article
What's systemic risk?
Journal of money, credit and banking, 2013, Vol. 45, No. 1, pp. 121-127
ALLEN, Franklin, CARLETTI, Elena, What's systemic risk?, Journal of money, credit and banking, 2013, Vol. 45, No. 1, pp. 121-127
- https://hdl.handle.net/1814/39666
Retrieved from Cadmus, EUI Research Repository
The traditional view of risk in a financial system is that it is the summation of individual risks within the system. However, the financial crisis that started in 2007 has driven home that this view of risk is inadequate. It is the interactions of financial institutions and markets that determine the systemic risks that drive financial crises. We identify four types of systemic risk. These are (i) panics—banking crises due to multiple equilibria; (ii) banking crises due to asset price falls; (iii) contagion; and (iv) foreign exchange mismatches in the banking system.
Cadmus permanent link: https://hdl.handle.net/1814/39666
Full-text via DOI: 10.1111/jmcb.12038
ISSN: 1538-4616
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