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The Concept And Determinants Of Systemic Risk- An Overview

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  • Laura Vasilescu

    (University of Craiova Faculty of Economics and Business Administration)

Abstract

Systemic risk is a fundamental concept for studying the level of financial instability and the possible ways of counteracting this phenomenon. In order to define the systemic risk within the financial systems, it is necessary to clarify some concepts that contribute to the outline of the systemic risk profile and to analyse its main components: the shock and the propagation mechanisms. Also, the concept of systemic risk must take into account its two dimensions: temporal, ie procyclicality, and structural, that is, the risk distribution in the system. Recent developments demonstrate the actuality of the systemic risk concept and in the same time, the gaps that persist in its approach. Therefore, defining the determinant elements, establishing the implications that the systemic risk generates within the financial system represent the prerequisites of effective measures in order to prevent and annihilate the consequences this can generate at the level of institutions, sectors or even economies as a whole.

Suggested Citation

  • Laura Vasilescu, 2019. "The Concept And Determinants Of Systemic Risk- An Overview," Annals of University of Craiova - Economic Sciences Series, University of Craiova, Faculty of Economics and Business Administration, vol. 2(47), pages 223-228, December.
    • Handle: RePEc:aio:aucsse:v:2:y:2019:i:47:p:223-228
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    File URL: http://feaa.ucv.ro/annals/v2_2019/024.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    systemic risk; financial crisis; determinant factors; effects;
    All these keywords.

    JEL classification:

    • F30 - International Economics - - International Finance - - - General
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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