In terms of technology, migration, environment, identity and geostrategy, the world has undergone many metamorphoses over time. But now these changes are mutually reinforcing each other to create a disruption with the past, leading to abandonment of global governance for resolving conflicts. The Cercle considers it urgent: Also, the World Trade Organization system should be made more effective — especially its Dispute Settlement Body -- and guarantee the participation of emerging countries.
Any errors are my own. Financial crises are costly - output and financial wealth are lost, unemployment increases, and social gaps widen. The costs may be prolonged, and they may become chronic. The global financial crisis that began ten Rencontres economiques d aix ago with the liquidity squeeze on global financial markets in August is still casting long shadows.
Global debt levels remain elevated.
The global financial crisis has had a significant impact on economic growth and unemployment. Such output losses have also had social consequences. In the euro area, the unemployment rate went up from 9. Answering the question of how economies can be protected from financial crisis is thus a key challenge for policymakers.
Complete "protection" against fluctuations on financial markets is not possible and would impair critical functions of markets in terms of the allocation of resources.
But reducing excessive risk-taking, making crises less likely and reducing their costs should be the ambition of policymakers.
In this note, I want to highlight three elements of a strategy for making future progress. First, agreed financial sector reforms need to be implemented. Enhancing the resilience of the financial system and improving buffers against unexpected shocks has been a key goal of post-crisis financial sector reforms.
High levels of debt can increase the fragility of finance, make financial crisis more likely, and be an impediment to growth. In response to the global financial crisis, governments have thus set out to tackle the underlying causes of the kind of financial distress that can seriously harm the economy.
Regulations have been amended in order to strengthen the financial system's capacity to buffer shocks and to promote strong, sustainable, balanced, and inclusive growth. Second, complementary reforms can make the reform agenda fully effective.
In Europe, the Capital Markets Union is such a complementary project. Implementing the Capital Markets Union can represent a major step forward towards achieving a more resilient financial system and putting in place improved mechanisms of cross-border risk sharing in Europe.
Third, effects of post-crisis reforms need to be evaluated. Full implementation of post-crisis financial sector reforms should be followed by a structured evaluation of the effects of reforms.
A structured evaluation is needed in order to assess the impact and the effectiveness of the reforms implemented and to study potential unintended consequences.
What are the drivers and costs of financial crises?
Financial crises have been a recurrent theme in economic history. Reinhart and Rogoff b have put together a large historical database covering eight centuries and 66 countries in Africa, Asia, Europe, Latin America, North America, and Oceania.
Analysing these data, the authors conclude: Technology has changed, the height of humans has changed, and fashions have changed. While fluctuations on financial markets are part of regular market processes, making crises less likely and less costly should be a key goal of economic policy.About Les Rencontres Economiques d’Aix en Provence.
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[Rencontres économiques d'Aix-en-Provence Topics: Régulation libérale, régulation publique. Messerli, Peter (). Is access to resources the key issue in conflicts?