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Alexandre Lamfalussy and the origins of the BIS macro-prudential approach to financial stability

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  • Ivo Maes

    () (National Bank of Belgium, Robert Triffin Chair, Universite catholique de Louvain, HUBrussel and ICHEC Brussels Management School)

Abstract

Among the international policy institutions, the Bank for International Settlements (BIS) is known for its sensitivity to financial stability issues. Typical for the BIS is a �macro-prudential� approach. In this paper, it is argued that Alexandre Lamfalussy, who was at the BIS from 1976 to 1993, played a crucial role in shaping the BIS approach. Typical for Lamfalussy are a broad macroeconomic view and a focus on the systemically important institutions. In Lamfalussy�s view, there is thus very much an overlap between the micro- and macro-prudential dimensions of financial stability. The main reasons for his sensitivity to financial fragility were: a �Keynesian� Weltanschauung (that a market economy is not sufficiently self-correcting), the emphasis of Dupriez (his teacher) on cycles, Lamfalussy�s experience as a commercial banker, BIS involvement in financial stability issues, especially the Latin American debt crisis of 1982-83 and research on financial innovations.

Suggested Citation

  • Ivo Maes, 2010. "Alexandre Lamfalussy and the origins of the BIS macro-prudential approach to financial stability," PSL Quarterly Review, Economia civile, vol. 63(254), pages 265-292.
  • Handle: RePEc:psl:pslqrr:2010:34
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    File URL: http://ojs.uniroma1.it/index.php/PSLQuarterlyReview/article/view/9429/9324
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    References listed on IDEAS

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    1. Lamfalussy, Alexandre, 1985. "The Changing Environment of Central Bank Policy," American Economic Review, American Economic Association, vol. 75(2), pages 409-413, May.
    2. Bank for International Settlements, 1986. "Recent innovations in international banking (Cross Report)," CGFS Papers, Bank for International Settlements, number 01.
    3. William R. White, 2006. "Procyclicality in the financial system: do we need a new macrofinancial stabilisation framework?," BIS Working Papers 193, Bank for International Settlements.
    4. Stephen M. Goldfeld, 1976. "The Case of the Missing Money," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(3), pages 683-740.
    5. Claudio E. V. Borio & Gianni Toniolo, 2006. "One hundred and thirty years of central bank cooperation: a BIS perspective," BIS Working Papers 197, Bank for International Settlements.
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    1. repec:aka:aoecon:v:67:y:2017:i:3:p:289-309 is not listed on IDEAS

    More about this item

    Keywords

    supervision; banking sector; Bank for International Settlements; Lamfalussy;

    JEL classification:

    • A11 - General Economics and Teaching - - General Economics - - - Role of Economics; Role of Economists
    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • B32 - Schools of Economic Thought and Methodology - - History of Economic Thought: Individuals - - - Obituaries
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • F02 - International Economics - - General - - - International Economic Order and Integration
    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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