Taming the Cycles of Finance?

Central Banks and the Macro-prudential Shift in Financial Regulation

Matthias Thiemann

• Publisher: Cambridge University Press
• Year: 2024
• Topic: Economics
• eBook ISBN:
  9781009233118
• Subtopic: Macroeconomics
• Index: Economics

Macroprudential regulation is a set of economic and policy tools that aim to mitigate risk in the financial and banking systems. It was largely developed in response to the financial crisis of 2007-08, turning central banks into de facto financial policemen. Taming the Cycles of Finance traces the post-crisis rise of macroprudential regulation and argues that, despite its original aims, it typically supports finance in times of crisis but fails to curb it in times of booms. Investigating how different macroprudential frameworks developed in the UK, the USA and the Eurozone, the book explains how central bank economists went about building early warning systems to identify fragilities in the financial system. It then shows how administrative and political constraints limited the effects of this shift, as central banks were wary of intervening in a discretionary manner and policymakers were opposed to measures to limit credit growth.

Table of contents

• Cover
• Half-title page
• Title page
• Copyright page
• Contents
• List of Figures
• List of Tables
• Prologue
• Acknowledgments
• 1 Introduction
• 2 The Changing Regulation of Finance after the Crisis: The State of the Art and Beyond
• 3 The Evolution of Systemic Risk Thinking Pre-crisis: An Expert Network in the Making
• 4 The Selective Rise of Macro-prudential Ideas in the Wake of the Crisis
• 5 Is Resilience Enough?: The Implementation of the Macro-Prudential Reform Agenda in the USA, the UK and the Eurozone
• 6 From the Global to the Local: Enacting the Countercyclical Capital Buffer through the Creation of Early Warning Systems
• 7 Taming Liquidity and Leverage in the Shadow Banking Sector
• 8 Into the Upswing
• 9 The Crisis That Wasn’t: The COVID-19 Crisis and Its Regulatory Implications
• 10 Conclusion: The Asymmetric Application of Financial Stability Concerns
• Appendix: List of Interviews Conducted
• References
• Index