Inadequacy of nation-based and var-based safety nets in the european union
By: Edward J. Kane.
Contributors: National Bureau of Economic Research.
Series: NBER working paper series -- working paper 12170; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 12170.
Publisher: National Bureau of Economic Research
Published: 2006
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "Considered as a social contract, a financial safety net imposes duties and confers rights on different sectors of the economy.  Within a nation, elements of incompleteness inherent in this contract generate principal-agent conflicts that are mitigated by formal agreements, norms, laws, and the principle of democratic accountability.  Across nations, additional layers of incompleteness emerge that are hard to moderate.  This paper shows that nationalistic biases and leeway in principles used to measure value-at-risk and bank capital make it unlikely that the crisis-prevention and crisis-resolution schemes incorporated in Basel II and EU Directives could allocate losses imbedded in troubled institutions efficiently or fairly across member nations"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 5/24/2006.

Includes bibliographical references.

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