IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2003-121.html
   My bibliography  Save this paper

Responsibility of Central Banks for Stability in Financial Markets

Author

Listed:
  • Mr. Garry J. Schinasi

Abstract

What is the role of central banks in ensuring financial stability? This paper addresses this controversial subject, in part by drawing on the experiences in Europe, Japan, and the United States, and by examining four questions. What is meant by financial stability? Do central banks have a natural role in ensuring financial stability? What does a central bank need to execute this role effectively? How far have central banks actually gone in safeguarding financial stability? The experience drawn on in the paper suggest that central banks: have a natural role to play; at times may require supervisory information to execute this natural role; and have incurred risks to their balance sheets to ensure financial stability.

Suggested Citation

  • Mr. Garry J. Schinasi, 2003. "Responsibility of Central Banks for Stability in Financial Markets," IMF Working Papers 2003/121, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2003/121
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=16526
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Andrew D. Crockett, 1997. "Why is financial stability a goal of public policy?," Economic Review, Federal Reserve Bank of Kansas City, vol. 82(Q IV), pages 5-22.
    2. Andrew D. Crockett, 1997. "Why is financial stability a goal of public policy?," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 7-36.
    3. Paul A. Volcker, 1984. "The Federal Reserve position on restructuring of financial regulation responsibilities," Federal Reserve Bulletin, Board of Governors of the Federal Reserve System (U.S.), issue Jul, pages 547-557.
    4. Prati, A. & Schinasi, G.J., 1999. "Financial Stability in European Economic and Monetary Union," Princeton Studies in International Economics 86, International Economics Section, Departement of Economics Princeton University,.
    5. Michael D. Bordo, 1990. "The lender of last resort : alternative views and historical experience," Economic Review, Federal Reserve Bank of Richmond, vol. 76(Jan), pages 18-29.
    Full references (including those not matched with items on IDEAS)

    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. Georges Dionne, 2003. "The Foundationsof Banks' Risk Regulation: A Review of Literature," THEMA Working Papers 2003-46, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    2. Oosterloo, Sander & de Haan, Jakob, 2004. "Central banks and financial stability: a survey," Journal of Financial Stability, Elsevier, vol. 1(2), pages 257-273, December.
    3. Zoë Venter, 2020. "The Interaction Between Conventional Monetary Policy and Financial Stability: Chile, Colombia, Japan, Portugal and the UK," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 62(3), pages 521-554, September.
    4. Tenea Andrei Cosmin, 2016. "Considerations On The Content And Objectives Of Financial Stability," Annals - Economy Series, Constantin Brancusi University, Faculty of Economics, vol. 2, pages 154-156, December.
    5. Ghosh, Saibal, 2001. "Financial Stability and Public Policy: An Overview," MPRA Paper 19757, University Library of Munich, Germany.
    6. Elsayed, Ahmed H. & Naifar, Nader & Nasreen, Samia, 2023. "Financial stability and monetary policy reaction: Evidence from the GCC countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 87(C), pages 396-405.
    7. Di Giorgio, Giorgio & Rotondi, Zeno, 2011. "Financial stability, interest-rate smoothing and equilibrium determinacy," Journal of Financial Stability, Elsevier, vol. 7(1), pages 1-9, January.
    8. Currie, Carolyn, 2006. "A new theory of financial regulation: Predicting, measuring and preventing financial crises," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(1), pages 48-71, February.
    9. Moutsianas, Konstantinos A. & Kosmidou, Kyriaki, 2016. "Bank earnings volatility in the UK: Does size matter? A comparison between commercial and investment banks," Research in International Business and Finance, Elsevier, vol. 38(C), pages 137-150.
    10. Marc Quintyn & Michael W. Taylor, 2003. "Regulatory and Supervisory Independence and Financial Stability," CESifo Economic Studies, CESifo Group, vol. 49(2), pages 259-294.
    11. International Monetary Fund, 2004. "Toward a Framework for Safeguarding Financial Stability," IMF Working Papers 2004/101, International Monetary Fund.
    12. Knorr Andreas, 1999. "Staatliche Bankenaufsicht – eine effiziente Institution?," ORDO. Jahrbuch für die Ordnung von Wirtschaft und Gesellschaft, De Gruyter, vol. 50(1), pages 345-370, January.
    13. Mikhail V. Oet & John M. Dooley & Stephen J. Ong, 2015. "The Financial Stress Index: Identification of Systemic Risk Conditions," Risks, MDPI, vol. 3(3), pages 1-25, September.
    14. J. Alejandro Fernández Fernández, 2019. "The Banking System in Australia and New Zealand: A Vision together," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 9(2), pages 1-1.
    15. Xavier Freixas & Curzio Giannini & Glenn Hoggarth & Farouk Soussa, 2000. "Lender of Last Resort: What Have We Learned Since Bagehot?," Journal of Financial Services Research, Springer;Western Finance Association, vol. 18(1), pages 63-84, October.
    16. Robiyanto Robiyanto & Michael Alexander Santoso & Apriani Dorkas Rambu Atahau & Harijono Harijono, 2019. "The Indonesia Stock Exchange and Its Dynamics: An Analysis of the Effect of Macroeconomic Variables," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 15(4), pages 59-73.
    17. Carolyn Currie, 2003. "Towards a General Theory of Financial Regulation: Predicting, Measuring and Preventing Financial Crises," Working Paper Series 132, Finance Discipline Group, UTS Business School, University of Technology, Sydney.
    18. George G. Kaufman, 1999. "Banking and currency crises and systemic risk: a taxonomy and review," Working Paper Series WP-99-12, Federal Reserve Bank of Chicago.
    19. Jakob Haan & Sander Oosterloo, 2006. "Transparency and accountability of central banks in their role of financial stability supervisor in OECD countries," European Journal of Law and Economics, Springer, vol. 22(3), pages 255-271, November.
    20. Mr. Martin Cihak, 2006. "How Do Central Banks Writeon Financial Stability?," IMF Working Papers 2006/163, International Monetary Fund.

    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:imf:imfwpa:2003/121. 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: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.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.