IDEAS home Printed from https://ideas.repec.org/p/bca/bocatr/95.html
   My bibliography  Save this paper

Essays on Financial Stability

Author

Listed:
  • John Chant
  • Alexandra Lai
  • Mark Illing
  • Fred Daniel

Abstract

The four essays published here provide a useful overview for anyone interested in understanding the issues and policy environment surrounding financial system stability. The first three essays consider different aspects of the question, What is financial stability/instability? The first essay, by John Chant, Special Adviser at the Bank in 2001–02, considers how financial instability differs from other kinds of instability, how it is different from the volatility normally associated with a well-functioning financial system, and how instability can be propagated within the financial system and to the real economy. In the second essay, Alexandra Lai tackles some of the problems raised by Chant; in particular, the difficulty of understanding the nature of crises. She reviews a range of theoretical approaches that have been pursued in order to understand the potential instabilities in domestic financial systems. In his essay, Mark Illing provides four case studies of episodes often thought of as periods of financial stress or crisis—the stock market crash of October 1987, the near-collapse of Long-Term Capital Management in 1998, the failures of the Canadian Commercial Bank and the Northland Bank in 1985, and the Bank of New York’s 1985 computer problem. The fourth essay, by Fred Daniel, provides a context for more general discussions of the role of policy in promoting financial stability, by providing an overview of the current institutional arrangements that condition financial behaviour in Canada and how the Bank of Canada interacts with other agencies who share responsibility for financial stability.

Suggested Citation

  • John Chant & Alexandra Lai & Mark Illing & Fred Daniel, 2003. "Essays on Financial Stability," Technical Reports 95, Bank of Canada.
    • Handle: RePEc:bca:bocatr:95
    as

    Download full text from publisher

    File URL: https://www.bankofcanada.ca/wp-content/uploads/2010/01/tr95.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Andy Haldane & Mark Kruger, 2002. "The Resolution of International Financial Crises: Private Finance and Public Funds," Bank of Canada Review, Bank of Canada, vol. 2001(Winter), pages 3-13.
    2. Jeff Powell, 2012. "International finance," Chapters, in: Jan Toporowski & Jo Michell (ed.), Handbook of Critical Issues in Finance, chapter 24, pages i-ii, Edward Elgar Publishing.
    3. James Powell, 2001. "Reforming the International Financial System," Bank of Canada Review, Bank of Canada, vol. 2001(Spring), pages 7-18.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zariņa Ilze & Voronova Irina & Pettere Gaida, 2018. "Assessment of the Stability of Insurance Companies: The Case of Baltic Non-Life Insurance Market," Economics and Business, Sciendo, vol. 32(1), pages 102-111, May.
    2. Garry J. Schinasi, 2011. "Defining Financial Stability and Establishing a Framework to Safeguard It," Central Banking, Analysis, and Economic Policies Book Series, in: Rodrigo Alfaro (ed.),Financial Stability, Monetary Policy, and Central Banking, edition 1, volume 15, chapter 3, pages 029-062, Central Bank of Chile.
    3. Soumia Zenasni, 2015. "Recent Trends in Regional Financial Integration and Trade Liberalization in Maghreb Countries: A Multivariate Threshold Autoregressive Analysis," FIW Working Paper series 145, FIW.
    4. Garry J. Schinasi, 2009. "Defining Financial Stability and a Framework for Safeguarding It," Working Papers Central Bank of Chile 550, Central Bank of Chile.
    5. Malgorzata Mikita, 2022. "The Interrelationship Among Efficiency and Concentration of Banking System and its Stability: Evidence from Poland," European Research Studies Journal, European Research Studies Journal, vol. 0(1), pages 670-689.
    6. CRISTE, Adina, 2014. "Reference Points For Financial Instability In The Euro Zone Candidates Countries," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 18(3), pages 58-75.
    7. Michał Buszko & Witold Orzeszko & Marcin Stawarz, 2021. "COVID-19 pandemic and stability of stock market—A sectoral approach," PLOS ONE, Public Library of Science, vol. 16(5), pages 1-26, May.
    8. International Monetary Fund, 2004. "Toward a Framework for Safeguarding Financial Stability," IMF Working Papers 2004/101, International Monetary Fund.
    9. Kremen Viktoriia & Shkolnyk Inna & Semenog Andrii & Kremen Olha, 2019. "Evaluating the Relationship Between Financial Sustainability and Socio-Economic Development of Countries," Central European Economic Journal, Sciendo, vol. 6(53), pages 25-38, January.
    10. Mr. Udaibir S Das & Mr. Marc G Quintyn & Miss Kina Chenard, 2004. "Does Regulatory Governance Matter for Financial System Stability? An Empirical Analysis," IMF Working Papers 2004/089, International Monetary Fund.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Schumacher, Julian & Trebesch, Christoph & Enderlein, Henrik, 2021. "Sovereign defaults in court," Journal of International Economics, Elsevier, vol. 131(C).
    2. Agur, Itai & Chan, Melissa & Goswami, Mangal & Sharma, Sunil, 2019. "On international integration of emerging sovereign bond markets," Emerging Markets Review, Elsevier, vol. 38(C), pages 347-363.
    3. Prasanna Gai & Ashley Taylor, 2004. "International Financial Rescues and Debtor‐Country Moral Hazard," International Finance, Wiley Blackwell, vol. 7(3), pages 391-420, December.
    4. Shim, Ilhyock & Sharma, Sunil & Chami, Ralph, 2008. "A Model of the IMF as a Coinsurance Arrangement," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 2, pages 1-41.
    5. Curzio Giannini, 2003. "Verso una procedura fallimentare per il debito sovrano e maggiore disciplina nei finanziamenti del Fondo Monetario Internazionale. Una valutazione di mezza via," Moneta e Credito, Economia civile, vol. 56(222), pages 161-193.
    6. Yilmaz AKYüZ, 2005. "Reforming The Imf: Back To The Drawing Board," G-24 Discussion Papers 38, United Nations Conference on Trade and Development.
    7. Philipp Maier, 2007. "Do We Need the IMF to Resolve a Crisis? Lessons from Past Episodes of Debt Restructuring," Staff Working Papers 07-10, Bank of Canada.
    8. Pavel Grigoriev & Markéta Pechholdová, 2017. "Health Convergence Between East and West Germany as Reflected in Long-Term Cause-Specific Mortality Trends: To What Extent was it Due to Reunification?," European Journal of Population, Springer;European Association for Population Studies, vol. 33(5), pages 701-731, December.
    9. Facundo Abraham & Juan J. Cortina & Sergio L. Schmukler, 2020. "The Expansion of Corporate Bond Markets in East Asia and Latin America," Documentos de Trabajo 18594, The Latin American and Caribbean Economic Association (LACEA).
    10. Andrew G Haldane & Gregor Irwin & Victoria Saporta, 2004. "Bail out or work out? theoretical considerations," Economic Journal, Royal Economic Society, vol. 114(494), pages 130-148, March.
    11. Pavel Grigoriev & Gabriele Doblhammer-Reiter & Vladimir Shkolnikov, 2013. "Trends, patterns, and determinants of regional mortality in Belarus, 1990-2007," Population Studies, Taylor & Francis Journals, vol. 67(1), pages 61-81, March.
    12. Omer Gersten & John R. Wilmoth, 2002. "The Cancer Transition in Japan since 1951," Demographic Research, Max Planck Institute for Demographic Research, Rostock, Germany, vol. 7(5), pages 271-306.
    13. Powell, Andrew & Arozamena, Leandro, 2003. "Liquidity protection versus moral hazard: the role of the IMF," Journal of International Money and Finance, Elsevier, vol. 22(7), pages 1041-1063, December.
    14. H Peyton Young & Mark Paddrik, 2019. "How Safe are Central Counterparties in Credit Default Swap Markets?," Economics Series Working Papers 885, University of Oxford, Department of Economics.
    15. Gambacorta, Leonardo & Brei, Michael & Lucchetta, Marcella & Parigi, Bruno, 2020. "Bad bank resolutions and bank lending," CEPR Discussion Papers 14379, C.E.P.R. Discussion Papers.
    16. Benjamin Martin & Adrian Penalver, 2003. "The effect of payments standstills on yields and the maturity structure of international debt," Bank of England working papers 184, Bank of England.
    17. Paddrick, Mark & Young, H. Peyton, 2021. "How safe are central counterparties in credit default swap markets?," LSE Research Online Documents on Economics 101170, London School of Economics and Political Science, LSE Library.
    18. Brei, Michael & Gambacorta, Leonardo & Lucchetta, Marcella & Parigi, Bruno Maria, 2023. "How effective are bad bank resolutions? New evidence from Europe," Journal of Financial Stability, Elsevier, vol. 67(C).
    19. Dungey, M. & Jacobs, J.P.A.M. & Lestano, L., 2010. "The internationalisation of financial crises," Research Report 10002, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
    20. Curzio Giannini, 2003. "Towards a sovereign bankruptcy procedure and greater restraint in IMF crisis lending. An interim assessmen," BNL Quarterly Review, Banca Nazionale del Lavoro, vol. 56(225), pages 83-112.

    More about this item

    Keywords

    Financial institutions; Financial markets;

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bca:bocatr:95. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/bocgvca.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.