An Historical Walk Through Recent Financial Crises
AbstractThis paper analyzes the causes and implications of recent financial crises. Financial crises in general lead to changes in both theory and practice of economics. The paper takes an historical overview. The global consensus of economic theory during the 20th century is discussed. The paper describes the Bretton Woods regime after World War II, details the era of adaptive expectations and motivates the emerging of the rational expectations school of thoughts. Various perspectives on the causes of the financial crisis are incorporated. The paper provides some policy suggestions and remarks on the consequences of ever-changing capital markets.
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Bibliographic InfoPaper provided by Penn Institute for Economic Research, Department of Economics, University of Pennsylvania in its series PIER Working Paper Archive with number 11-019.
Length: 26 pages
Date of creation: 06 Jul 2011
Date of revision:
Financial crises; The United States Financial Crisis Inquiry Commission; The 2010 Economic Report of the United States President; Keynsian Theory; Adaptive Expectations; Rational Expectations; Monetary and Fiscal Policies; Business Cycles; Regulations; General Agreement on Tariffs and Trade (GATT); World Trade Organization (WTO); Trade Liberalization; United States; China; Euro; Econometric Policy Evaluation;
Find related papers by JEL classification:
- B0 - Schools of Economic Thought and Methodology - - General
- E0 - Macroeconomics and Monetary Economics - - General
- E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
- E4 - Macroeconomics and Monetary Economics - - Money and Interest Rates
- E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
- E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
- F0 - International Economics - - General
- F3 - International Economics - - International Finance
- F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
- G0 - Financial Economics - - General
- G01 - Financial Economics - - General - - - Financial Crises
- H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
- H6 - Public Economics - - National Budget, Deficit, and Debt
- K2 - Law and Economics - - Regulation and Business Law
- O51 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada
- P1 - Economic Systems - - Capitalist Systems
- R3 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-07-13 (All new papers)
- NEP-CBA-2011-07-13 (Central Banking)
- NEP-HIS-2011-07-13 (Business, Economic & Financial History)
- NEP-HPE-2011-07-13 (History & Philosophy of Economics)
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.:
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Cambridge University Press, number 9780521479394, December.
- Fogli, Alessandra & Perri, Fabrizio, 2006.
"The 'Great Moderation' and the US External Imbalance,"
CEPR Discussion Papers
6010, C.E.P.R. Discussion Papers.
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- Alan S. Blinder, 2010. "Teaching Macro Principles after the Financial Crisis," Working Papers 1222, Princeton University, Department of Economics, Center for Economic Policy Studies..
- Kowalski, Tadeusz, 2002. "The Simonian bounded rationality hypothesis and the expectation formation mechanism," MPRA Paper 33981, University Library of Munich, Germany.
- Ouarda Merrouche & Erlend Nier, 2010. "What Caused the Global Financial Crisis - Evidence on the Drivers of Financial Imbalances 1999 - 2007," IMF Working Papers 10/265, International Monetary Fund.
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