The First-world Debt Crisis Of 2007-2010 In Global Perspective

摘要

Comparison of crisis indicators between previous crises in industrial economies and the United States in the run-up to 2007 suggests that the current one will be worse than most of the previous ones. But even if the downturn turns out to be mild-a few quarters of falling output in the United States, barely growing output in Europe, a few million people losing ownership of their houses, longer working hours and stagnant wages for most of the labor force, and not much effect on the rest of the world-the crisis has already thrown up important lessons that should inform the debate about reform. For a start, the efficient-market theory, which has justified the push for liberalization, has been shown to be wanting. We have had competitive financial markets, but competitiveness has not generated efficient and stable financial markets (as distinct from very profitable markets). The externalities or interconnectedness with other parts of the economy are too big for political authorities to abide by the theory's prescriptions. Indeed, the record of previous crises shows that, even in industrial economies, financial liberalization is a leading indicator of future crisis. True, the United States did not have much de jure financial liberalization in the 2000s. But the proliferation of originate-and-distribute transactions constituted a further de facto liberalization as barely regulated entities came to play a much larger role in the financial system, raising the vulnerability to certain kinds of shocks.