Efficiency of Mechanisms for Ensuring Financial Stability in Developed Countries
The aim of the article is to identify relationships between the monetary policy and long-term financial stability. The main method of the study is retrospective analysis of macroeconomic and financial performance of the United States and other developed countries. It has been shown that neither Neo...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
| Published: |
PH "INZHEK"
2016-08-01
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| Series: | Problemi Ekonomiki |
| Subjects: | |
| Online Access: | http://www.problecon.com/export_pdf/problems-of-economy-2016-3_0-pages-6_14.pdf |
| Summary: | The aim of the article is to identify relationships between the monetary policy and long-term financial stability. The main method of the study is retrospective analysis of macroeconomic and financial performance of the United States and other developed countries. It has been shown that neither
Neo-Keynesian nor monetarist approaches are able to provide long-term financial stability under simultaneous low levels of volatility of GDP and inflation. In addition, the policy of inflation targeting in developed countries is not able to eliminate the risk of significant macro-economic recessions.
The article states that the cause of the recessions is a systemic risk growth
due to concentration of financial resources in the banking sector and in the
hands of owners of non-financial corporations. This concentration has two
effects: 1) growth of moral hazard at crediting; 2) decrease in the effective demand on the part of households. Redistribution of financial resources among different macro-economic groups of agents does not happen in a short period of time and is a result of the long-term monetary policy. Since
the modern economic statistics has certain methodological problems with calculation of the Gini coefficient, such indicator as a share of wages in GDP
is proposed in the article for studying the dynamics of uneven distribution of financial resources in the United States. The conducted retrospective analysis
of the US monetary policy showed that an important system indicator of uniformity of financial resources distribution among macroeconomic agents
falls out of sight of regulators. Distribution of macroeconomic risks depends on distribution of financial resources in the system, which determines its financial stability. The article justifies the need for developing the monetary policy methods that would simultaneously minimize the volatility of the GDP, inflation and maintain a uniform distribution of financial resources at an
acceptable level. |
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| ISSN: | 2222-0712 2311-1186 |