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Macro Financial Determinants of the Great Financial Crisis: Implications for Financial Regulation

  • Caprio, Gerard Jr.
  • D'Apice, Vincenzo
  • Ferri, Giovanni
  • Puopolo, Giovanni Walter

By analysing the macro financial determinants of the Great Financial Crisis of 2007-2009 on 83 countries, we find that the probability of suffering the crisis in 2008 was larger for countries having higher levels of credit deposit ratio whereas it was lower for countries having higher levels of: i) net interest margin, ii) concentration in the banking sector, iii) restrictions to bank activities, iv) private monitoring. Our findings contribute to the ongoing discussion that can help policymakers calibrate new regulation, by achieving a reasonable trade-off between financial stability and economic growth.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 26088.

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Date of creation: 21 Oct 2010
Date of revision:
Publication status: Published in Temi di Economia e Finanza Special Issue.1(2010): pp. 1-31
Handle: RePEc:pra:mprapa:26088
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