The myth of financial innovation and the Great Moderation

Wouter den Haan, Vincent Sterk, 8 November 2011



Many changes have taken place in the financial sector over the last couple of decades. Deregulation was followed by a burst of innovation, a step-up in leverage, an increase in cross-border capital flows, and larger financial institutions.

Topics: Financial markets
Tags: business cycles, financial institutions, great moderation

Does the Great Recession really mean the end of the Great Moderation?

Olivier Coibion, Yuriy Gorodnichenko, 16 January 2010



“No one knows for sure what caused the Great Moderation. Some had credited increased sophistication of financial markets and the wisdom of the Federal Reserve Board... Well, folks, it turns out the great moderation was something of a fluke.” – Robert Reich, 15 July 2008

Topics: Macroeconomic policy
Tags: great moderation, inflation, monetary policy

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