Implications of Globalization for Monetary Policy

2010

Int Econ Econ Policy

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“…Globalization leads to increasing, and increasingly unfamiliar, linkages and interdependencies that can easily turn critical (see, e.g., Wagner 2001;Wagner and Berger 2004).…”

Section: Conclusion and Lessonsmentioning

confidence: 99%

The causes of the recent financial crisis and the role of central banks in avoiding the next one

2010

Int Econ Econ Policy

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“…Globalization and deregulation have led to an increase in international dependencies and externalities (cross-national contagion effects) and thus, among other things, to more costly and more global financial crises. 20 Regulatory arbitrage in the context of locational competition has played a crucial rule here (Wagner 2001(Wagner , 2006. 16 See in this context, e.g., the war of attrition models in political macroeconomics, see Alesina and Drazen (1991) or Drazen (2000).…”

Section: When Are Uniform Rules Appropriate? Lessons From the Financimentioning

confidence: 99%

“…This means that particular interest groups prevent a transition towards superior rules (what is typical for necessary reform processes often prevented or delayed after structural changes such as globalization); see, e.g.,Wagner (2001Wagner ( , 2006.…”

mentioning

confidence: 99%

Is harmonization of legal rules an appropriate target? Lessons from the global financial crisis

2011

Eur J Law Econ

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This article deals critically with the call for a comprehensive harmonization of legal rules, against the background of the lessons from the recent financial crisis. Before coming to the topic of harmonization of legal rules, it first briefly deals with the question of why rules are necessary at all, and what the functions of rules are. Then it deals with the lessons from the recent financial crisis for the topic mentioned. The article conducts a kind of cost-benefit analysis of legal harmonization by looking at arguments in favor of and against uniform rules. It shows that not only the arguments in favor have increased after the recent financial crisis, but also the arguments against. It also shows that integration of global markets has not only increased the need for new uniform rules but also decreased the chances of their implementation; and that therefore today it is often better to improve the implementation of current rules instead of laying down new uniform rules.

“…9. The hypothesis that increasing locational competition reduces inflation pressure has also been modelled (Wagner, 2000c(Wagner, , 2001Kißmer, 2001). 10.…”

Section: Notesmentioning

confidence: 99%

Globalization, Financial Volatility and Monetary Policy

Berger

2004

Empirica

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Abstract. Recently it has often been claimed that globalization eases the job of central banks as it helps to tame inflation. This is used to argue that central banks (particularly the ECB, referring to the objectives as laid down in the EU Treaty) could or should reduce their efforts in the fight against inflation in favor of supporting the general economic policies of the governments. This paper takes a critical look at this argument, pointing to the structural changes associated with globalization and to the corresponding increase in uncertainty by which the central banks are affected. As an example of this, the increase in financial volatility is analyzed and explained as the result of optimal portfolio allocation, and its implications for monetary policy are discussed.