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Financial risks, monetary policy in the QE era, and regulation

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  • Kouretas, Georgios P.
  • Papadopoulos, Athanasios P.
  • Tavlas, George S.

Abstract

At the beginning of the present century, the literature on financial integration focused on the benefits of increased integration. In particular, the literature emphasized that a well-integrated financial system allows economic agents to engage in risk sharing while enhancing the smooth transmission of monetary policy. However, the international financial crisis of 2007-08 and the euro area sovereign debt crisis of 2009-15, brought to the fore the flip side of increased financial integration – namely, that higher financial integration among national jurisdictions creates the potential for destabilizing cross-country spillovers of capital flows. The papers in this Special Issue address financial system vulnerabilities in the aftermath of the 2007-08 financial crisis and the 2009-15 euro area crisis. In particular, the papers assess (1) vulnerabilities arising from such factors as the liberalization of financial systems, cross-country contagion, and climate change, and (2) policy responses, including macroprudential supervision and quantitative easing, to financial instabilities.

Suggested Citation

  • Kouretas, Georgios P. & Papadopoulos, Athanasios P. & Tavlas, George S., 2022. "Financial risks, monetary policy in the QE era, and regulation," Journal of Financial Stability, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:finsta:v:63:y:2022:i:c:s1572308922000730
    DOI: 10.1016/j.jfs.2022.101051
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    References listed on IDEAS

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    2. Marchionne, Francesco & Pisicoli, Beniamino & Fratianni, Michele, 2022. "Regulation, financial crises, and liberalization traps," Journal of Financial Stability, Elsevier, vol. 63(C).
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    5. Minford, Patrick & Ou, Zhirong & Wickens, Michael & Zhu, Zheyi, 2022. "The eurozone: What is to be done to maintain macro and financial stability?," Journal of Financial Stability, Elsevier, vol. 63(C).
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    11. Kabundi, Alain & De Simone, Francisco Nadal, 2022. "Euro area banking and monetary policy shocks in the QE era," Journal of Financial Stability, Elsevier, vol. 63(C).
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    Cited by:

    1. Giraldo, Carlos & Giraldo, Iader & Gomez-Gonzalez, Jose E. & Uribe, Jorge M., 2024. "Financial integration and banking stability: A post-global crisis assessment," Economic Modelling, Elsevier, vol. 139(C).
    2. Marina Yu. Malkina, 2024. "Financial contagion in the US, European and Chinese stock markets during global shocks," Journal of New Economy, Ural State University of Economics, vol. 25(4), pages 47-67, December.
    3. Yang, Ronghai & Sun, Xiaowen & Wang, Honglei & Wang, Xiao, 2024. "A study of the time-varying impact of capital account liberalization on monetary policy rules in the open economy: Evidence from China," Finance Research Letters, Elsevier, vol. 65(C).

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