Financial crises: An endless saga?

The high social costs of financial crises imply that economists, policymakers, businesses, and households have a tremendous incentive to understand, and try to prevent them. And yet, so far we have failed to learn how to avoid them. Recent research by Prof. Charles Calomiris and coauthors (https://www.nber.org/papers/w32213)  takes a novel approach to studying financial crises. They first build ten case studies of financial crises that stretch over two millennia, and then consider their salient points of differences and commonalities. This provides the beginning of developing a useful taxonomy of crises – an understanding of the most important factors that reappear across the many examples, which also allows (as in any taxonomy) some examples to be more similar to each other than others. From the perspective of this review of the ten crises, they consider the question of why it has proven so difficult to learn from past crises to avoid future crises. The presentation by Prof. Charles Calomiris (Columbia Business School) will be followed by two discussants, a senior academic (Jón Danielson, LSE and SUERF Fellow) and a senior policy maker (Nathanaël Benjamin, BoE). The event will be chaired by Cornelia Holthausen, ECB.

Scientific coordination: Martin Scheicher, SSM/ECB and SUERF Fellow