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Financial Instability, Cycles and the Role of Institutions

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  • Iancu, Aurel

Abstract

In this study I review the main scientific contributions of Minsky and other scholars to the financial instability and crisis issues, and the role of institutions in modeling the medium and long financial and business waves. The topics developed in this paper are the following: the relationships between financial instability, financial and business crisis and institutions; the thwarting of the explosive instability by the specific institutions’ actions and regulations; the impact of the institutional changes on the financial and business cycles; an empiric approach to the financial and business cycles and their synchronization in the Central and Eastern European countries/ members of the EU, taking into account the main characteristics of the changes in these countries’ institutions.

Suggested Citation

  • Iancu, Aurel, 2014. "Financial Instability, Cycles and the Role of Institutions," Working Papers of National Institute of Economic Research 141007, National Institute of Economic Research.
    • Handle: RePEc:ror:wpince:141007
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    References listed on IDEAS

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    1. Lown, Cara & Morgan, Donald P., 2006. "The Credit Cycle and the Business Cycle: New Findings Using the Loan Officer Opinion Survey," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 38(6), pages 1575-1597, September.
    2. Bordo, Michael D & Jeanne, Olivier, 2002. "Monetary Policy and Asset Prices: Does 'Benign Neglect' Make Sense?," International Finance, Wiley Blackwell, vol. 5(2), pages 139-164, Summer.
    3. Kiyotaki, Nobuhiro & Moore, John, 1997. "Credit Cycles," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 211-248, April.
    4. Iancu, Aurel, 2013. "Financialisation: Structure, Extent, Consequences," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 172-192, June.
    5. Lucian-Liviu ALBU, 2013. "Impact Of Actual Crisis On Eu Convergence," Internal Auditing and Risk Management, Athenaeum University of Bucharest, vol. 30(1), pages 125-134, June.
    6. L. Randall Wray, 2009. "The rise and fall of money manager capitalism: a Minskian approach," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 807-828, July.
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    8. Allen Sinai, 1992. "Financial and Real Business Cycles," Eastern Economic Journal, Eastern Economic Association, vol. 18(1), pages 1-54, Winter.
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    13. Eric Nasica, 1999. "Thwarting systems and institutional dynamics or how to stabilize an unstable economy," Post-Print halshs-00468148, HAL.
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    More about this item

    Keywords

    financial instability; business cycles; financial cycles; institutions; long waves; basic cycles; supercycles; Central and Eastern European countries;

    JEL classification:

    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary
    • B52 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Historical; Institutional; Evolutionary
    • D53 - Microeconomics - - General Equilibrium and Disequilibrium - - - Financial Markets
    • G01 - Financial Economics - - General - - - Financial Crises
    • G2 - Financial Economics - - Financial Institutions and Services
    • L51 - Industrial Organization - - Regulation and Industrial Policy - - - Economics of Regulation
    • P11 - Economic Systems - - Capitalist Systems - - - Planning, Coordination, and Reform
    • P21 - Economic Systems - - Socialist Systems and Transition Economies - - - Planning, Coordination, and Reform
    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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