Freixas X, Mayer C

FREIXAS DARGALLO, XAVIER

Scholarly articles

Oxford Review of Economic Policy

2011

27

3

397-410

0266-903X

Published

This paper provides an overview of the issue. It considers the existing structure of financial regulation, the deficiencies that were encountered during the financial crisis, and the proposed reforms. It discusses whether these are likely to be adequate and argues that there are fundamental failures in product markets, capital markets, and government relations with financial institutions highlighted in the articles in this issue that question whether current reforms will prove sufficient. In particular, the article argues that a clearly defined partnership between the state and the banking system needs to be established by which the state protects certain core components of the banking system that perform key functions in an economic system and well specified rules are put in place to avoid renegotiation and lobbying.

Freixas X, Mayer C. Banking, finance, and the role of the state. Oxford Review of Economic Policy 2011; 27(3): 397-410.