The Role of the State in Managing and Forestalling Systemic Financial Crises : Some Issues and Perspectives
AbstractThis paper reviews recent state interventions in financial crises and draws lessons for crisis management. A number of areas are identified where crisis management could be strengthened, including with regard to the tools and instruments used to involve the private sector in crisis resolution (with a view to reducing the recent enhanced role of official bailouts and the associated moral hazard), to allow for the orderly resolution of systemically important financial firms (to make these firms safe to fail), and with regard to achieving better integration with ex ante macroprudential surveillance. The paper proposes the establishment of high level systemic risk councils (SRCs) in each country with responsibility for overseeing systemic risk in both tranquil times and crisis periods and coordinating the activities of key government ministries, agencies, and the central bank.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Macroeconomics Working Papers with number 21867.
Date of creation: Jan 2010
Date of revision:
Contact details of provider:
Postal: JG Crawford Building #13, Asia Pacific School of Economics and Government, Australian National University, ACT 0200
Web page: http://www.eaber.org
More information through EDIRC
financial crisis; crisis management; private sector; moral hazard; systemic risk councils;
Find related papers by JEL classification:
- G01 - Financial Economics - - General - - - Financial Crises
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Marc Quintyn & David S. Hoelscher, 2003. "Managing Systemic Banking Crises," IMF Occasional Papers, International Monetary Fund 224, International Monetary Fund.
- Reinhart, Carmen M. & Rogoff, Kenneth S., 2013.
"Banking crises: An equal opportunity menace,"
Journal of Banking & Finance, Elsevier,
Elsevier, vol. 37(11), pages 4557-4573.
- Carmen M. Reinhart & Kenneth S. Rogoff, 2008. "Banking Crises: An Equal Opportunity Menace," NBER Working Papers, National Bureau of Economic Research, Inc 14587, National Bureau of Economic Research, Inc.
- Reinhart, Carmen & Rogoff, Kenneth, 2009. "Banking Crises: An Equal Opportunity Menace," CEPR Discussion Papers, C.E.P.R. Discussion Papers 7131, C.E.P.R. Discussion Papers.
- Fabian Valencia & Luc Laeven, 2008. "Systemic Banking Crises," IMF Working Papers, International Monetary Fund 08/224, International Monetary Fund.
- Kydland, Finn E & Prescott, Edward C, 1977. "Rules Rather Than Discretion: The Inconsistency of Optimal Plans," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 85(3), pages 473-91, June.
- Peter J. Morgan & Mario Lamberte, 2012.
"Strengthening Financial Infrastructure,"
Finance Working Papers, East Asian Bureau of Economic Research
23191, East Asian Bureau of Economic Research.
- Morgan, Peter J. & Lamberte , Mario, 2012. "Strengthening Financial Infrastructure," ADBI Working Papers, Asian Development Bank Institute 345, Asian Development Bank Institute.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shiro Armstrong).
If references are entirely missing, you can add them using this form.