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The Great Leveraging

52 Pages Posted: 12 Apr 2013  

Alan M. Taylor

University of California, Davis - Department of Economics; University of Virginia - Department of Economics; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 3 versions of this paper

Date Written: December 2012

Abstract

What can history can tell us about the relationship between the banking system, financial crises, the global economy, and economic performance? Evidence shows that in the advanced economies we live in a world that is more financialized than ever before as measured by importance of credit in the economy. I term this long-run evolution The Great Leveraging and present a ten-point examination of its main contours and implications.

Keywords: banking, financial development, credit, booms, crises, recessions, global imbalances, Great Recession, fiscal policy

JEL Classification: E3, E5, E6, N1, N2

Suggested Citation

Taylor, Alan M., The Great Leveraging (December 2012). BIS Working Paper No. 398. Available at SSRN: https://ssrn.com/abstract=2248642

Alan M. Taylor (Contact Author)

University of California, Davis - Department of Economics ( email )

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HOME PAGE: http://www.econ.ucdavis.edu/faculty/amtaylor/

University of Virginia - Department of Economics ( email )

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HOME PAGE: http://people.virginia.edu/~amt7u

National Bureau of Economic Research (NBER)

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Centre for Economic Policy Research (CEPR)

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