CFLP blue bag lunch talk with Prof. Jeffery Zhang

Conventional wisdom says the 2008 financial crisis fundamentally changed how policymakers approach financial regulation, with regulators seeking to prevent individual financial institutions from collapsing using a “microprudential” strategy before the crisis, and turning to a new “macroprudential” approach that prioritizes the stability of the financial system as a whole post-crisis. Despite new stress tests, capital buffers, liquidity requirements, and other supposed macroprudential tools, Prof. Zhang will present his research, co-authored with Jeremy Kress, which argues that using the term “macroprudential” to describe modern financial regulation is a myth. Despite the macroprudential label, the prevailing regulatory framework is still predominantly microprudential in nature. This inaccurate portrayal has consequences, and risks a repeat of the 2008 collapse. How to re-orient? Prof. Zhang has some ideas. 

• Economics and finance
• financial regulation