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Julio Ramos-Tallada

23 September 2015
OCCASIONAL PAPER SERIES - No. 166
Details
Abstract
The decrease of financial integration both at the global and European level reflects, to a certain extent, a market response to the crisis. It might, however, also be partly driven by policies such as capital flow management measures (CFMs). In addition, several other measures taken by central banks, regulators and governments in response to the crisis may have had less obvious negative side effects on financial integration. Against this backdrop, this paper explores broad definitions of financial protectionism in order to raise awareness of the fact that the range of policies which could negatively affect financial integration may be much wider than residency-based CFMs. At the same time, the paper acknowledges that these measures have mostly been taken for legitimate financial stability purposes and with no protectionist intentions. The paper considers five categories of policy measures which could contribute to financial fragmentation both at the global and at the EU level: currency-based measures directed towards banks, geographic ring fencing, some financial repression policies, crisis resolution policies with a national bias, and some financial sector taxes.
JEL Code
F36 : International Economics→International Finance→Financial Aspects of Economic Integration
F42 : International Economics→Macroeconomic Aspects of International Trade and Finance→International Policy Coordination and Transmission
F62 : International Economics→Economic Impacts of Globalization→Macroeconomic Impacts