Five explanations for the international financial crisis
AbstractThis paper first briefly outlines the background to the 2007-08 international financial crisis. It then goes on to examine five of the main approaches that have been put forward to explain the crisis: the widespread presence of perverse incentives; the over-expansionary monetary policy of the US Federal Reserve; the impact of global imbalances and a so-called 'savings glut' in developing countries; the extensive deregulation of the financial system since the 1970s; and the attempt to generate an increasing return on all forms of capital and the associated pressure on wages. The paper concludes with a brief note on the policy implications which follow from each of these explanations. --
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Bibliographic InfoPaper provided by Berlin School of Economics and Law, Institute for International Political Economy (IPE) in its series IPE Working Papers with number 08/2010.
Date of creation: 2010
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- Thomas Goda, 2013. "The role of income inequality in crisis theories and in the subprime crisis," Working Papers PKWP1305, Post Keynesian Economics Study Group (PKSG).
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