Too Big to Fail: The Transatlantic Debate

41 Pages Posted: 25 Jan 2011 Last revised: 17 Feb 2011

See all articles by Morris Goldstein

Morris Goldstein

Peter G. Peterson Institute for International Economics

Nicolas Veron

Bruegel; Peter G. Peterson Institute for International Economics

Date Written: January 24, 2011

Abstract

Although the United States and the European Union were both seriously impacted by the financial crisis of 2007, resulting policy debates and regulatory responses have differed considerably on the two sides of the Atlantic. In this paper the authors examine the debates on the problem posed by “too big to fail” financial institutions. They identify variations in historical experiences, financial system structures, and political institutions that help one understand the differences of approaches between the United States, EU member states, and the EU institutions in addressing this problem. The authors then turn to possible remedies and how they may be differentially implemented in America and Europe. They conclude on which policy developments are likely in the near future.

Keywords: Banks, Comparative Political Economy, Financial Regulation, Microprudential Policy, Too-Big-to-Fail

JEL Classification: G01, G21, G38, F36

Suggested Citation

Goldstein, Morris and Veron, Nicolas, Too Big to Fail: The Transatlantic Debate (January 24, 2011). Peterson Institute for International Economics Working Paper No. 11-2. Available at SSRN: https://ssrn.com/abstract=1746982 or http://dx.doi.org/10.2139/ssrn.1746982

Morris Goldstein (Contact Author)

Peter G. Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036-1903
United States

Nicolas Veron

Bruegel ( email )

Rue de la Charité 33
B-1210 Brussels Belgium
Belgium

Peter G. Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

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