Financial crises have become an all too common occurrence over the past twenty years, largely as a result of changes in finance brought about by increasing internationalization and integration. As domestic financial systems and economies have become more interlinked, weaknesses can significantly impact not only individual economies but also markets, financial intermediaries, and economies around the world. This volume addresses the twin objectives of financial development in the context of financial stability and the role of law in supporting both. Financial stability (frequently seen as the avoidance of financial crisis) has become an objective of both the international financial architecture and individual economies and central banks. At the same time, financial development is now seen to play an important role in economic growth. In both financial stability and financial development, law and related institutions have a central role.

"Publication of the Principles of Freedom Committee." Includes bibliographical references.

There is growing dissatisfaction with the economic policies advocated by the IMF and other international financial institutions - policies that have often resulted in stagnating growth, crises, and recessions for client countries. This book presents an alternative to "Washington Consensus" neo-liberal economic policies by showing that both macro-economic and liberalization policy must be sensitive to the particular circumstances of developing countries. One-size-fits-all policy prescriptions are likely to fail given the vast differences between countries. This book discusses how alternative approaches to economic policy can better serve developing countries both in ordinary times and in times of crisis.

The state and its institutions are crucial for economic development: for better and for worse. This insight informs this important, up-to-date and authoritative survey of new trends in growth economics and the widely divergent economic performance of developing countries - for example, between Latin America and South-east Asia - which seemed to be similarly placed just a generation ago. The decisive role of the political dimension in economic growth seems clear but there are many challenges to be met in getting an analytical handle on the precise determinants and in testing empirically for this. This is the challenge taken up by the international team of contributors.

John Taylor is one of the foremost economists of our generation. His ideas were implemented in central banks across the world during the period of price stability, economic growth and financial stability that followed the 1980s. Of course, this period culminated in the financial crisis of 2008, which was followed by a very slow recovery, which, eight years on, can hardly be said to be complete. This short book presents Taylor’s view of the financial crisis and its aftermath as expressed in the 2014 F. A. Hayek Memorial Lecture. He believes that the rules-based monetary policy that he espoused broke down in the run-up to the crisis and afterwards. Furthermore, other aspects of policy became erratic and discretionary to the point that the rule of law could be said to be under threat. According to the author, these problems contributed to the crisis and to the slow recovery – indeed, they were a major cause. Two commentaries follow John Taylor’s lecture. One is by Patrick Minford and the other is by the Bank of England’s Chief Economist Andrew Haldane and Amar Radia. Both recognise Taylor’s immense contribution to economic theory and policy. The commentaries are themselves an important contribution and they are followed by a response from John Taylor which addresses the issues raised by the commentators.