New Keynesian Economics that rely on the DSGE technology has been criticized as being hopelessly inadequate for dealing with financial crises of the type that we have seen in recent years or - more generally - with failures of the intertemporal price mechanism to coordinate investment and saving. However, the "financial frictions" literature has made considerable progress in using DSGE frameworks for modeling (shadow) banking, credit cycles, and financial crises. This paper provides an assessment of what has been achieved by the reformulations of the DSGE approach and what inadequacies remain in the light of the approaches of Keynes, Fisher, Minsky, and others.
Financial Instability, Market Disruptions and Macroeconomics: Lessons from Economic History and the History of Economic Thought (Veranstaltung : 5. : 2019 : Rom) Financial markets in perspective Cham, Switzerland : Springer, 2022 (2022), Seite 227-248 xviii, 265 Seiten
monetary union; central bank cooperation; banking crises; lending of last resort; Scandinavia; Währungsunion; Zentralbankkooperation; Bankkrisen; Skandinavien; Aufsatz in Zeitschrift
The functioning of multi-nation monetary unions with several central banks is conditioned by many factors and considerations, such as the capacity to deal with crises, the political will and operational skill to foster financial integration and to develop a mix of rules and discretion in the cooperation between the central banks. The Scandinavian monetary union (SMU) between 1873 and 1931 is a case in point for illustrating the importance of these factors and considerations. We examine the policies implemented in the Scandinavian countries to deal with asymmetries of payments flows and with financial crises at three levels: in an account of major crises that required lending of last resort, in a study of the clearing and settlement mechanism established in the union, and in a survey of contemporary economists' views on lending of last resort and cooperation in the SMU.
Jahrbuch für Wirtschaftsgeschichte Berlin : De Gruyter, 1960 63(2022), 2, Seite 433-494 Online-Ressource
European and Chinese histories of economic thought London : Routledge, Taylor & Francis Group, 2022 (2022), Seite 170-183 1 Online-Ressource (xvii, 309 Seiten)
financial crises; lending of last resort; monetary union; gold standard; central bank cooperation; Finanzkrisen; Kreditvergabe der letzten Instanz; Währungsunion; Goldstandard; Zentralbankkooperation; Aufsatz in Zeitschrift
This paper provides an introduction to the special issue on international lending of last resort. Starting from debates about rescue operations and unconventional policies of major central banks in the contexts of the Global Financial Crisis and the European Debt Crisis, it draws attention to recurring controversies about trade-offs between averting critical contagion in financial markets and avoiding moral hazard. The need for international lending of last resort in strongly interconnected financial systems is more than ever evident, but there is no clear consensus on how to manage it. The contributions to this special issue put relevant issues in historical and theoretical perspectives.
Jahrbuch für Wirtschaftsgeschichte Berlin : De Gruyter, 1960 63(2022), 2, Seite 303-310 Online-Ressource
