The Editors, 02 July 2009

The latest ICMB/CEPR report discusses how world leaders should think about financial regulation reform, making a number of specific proposals.

Jon Danielsson, 05 January 2009

Much of today’s financial regulation assumes that risk can be accurately measured – that financial engineers, like civil engineers, can design safe products with sophisticated maths informed by historical estimates. But, as the crisis has shown, the laws of finance react to financial engineers’ creations, rendering risk calculations invalid. Regulators should rely on simpler methods.

Horst Siebert, 04 January 2009

This column argues that national governments ought to credibly commit themselves to not bailing out their banks if the worst comes. But it would be far from easy to do so.

Donato Masciandaro, 04 January 2009

Government guarantees for financial institutions that are "too big to fail" seem unavoidable, but such insurance against insolvency imposes major costs and may increase the risk of crisis. This column argues for the necessity of non-conventional regulatory solutions to make big banks pay for their implicit insurance. Progressive capital ratios may be one such solution.

Marco Pagano, 17 October 2008

EU leaders have agreed on a bail-out plan but much is still unknown about its details. How will governments act as equity shareholders? Who will deal with cross-border banks? This column discusses the need for a Euro-area bank supervisory authority, as financial integration has outpaced regulatory integration.

Charles Calomiris, 22 August 2008

The subprime crisis is the joint product of perverse incentives and historical flukes. This column explains why market actors made unrealistic assumptions about mortgage-backed securities and how various regulatory policies exacerbated the problem. The crisis will necessitate changes in monetary policy, regulation, and the structure of financial intermediation.



CEPR Policy Research