Secondly, there are specific (tax or employment, for example) regulations in place intended to assist small and medium-sized enterprises, but which may actually discourage their growth. Indeed, there is evidence of an artificially high concentration of firms at sizes immediately prior to certain regulatory thresholds. That would denote the need to adapt existing regulations, so as to avoid these deterrents to business growth.9 Finally, while the foregoing types of regulation discourage company growth, there are other types of rules that may occasionally prevent such growth. This is because such rules artificially distort firms’ costs, benefiting those already in place, and which are generally bigger, to the detriment of new firms, which are usually smaller. The specific nature of these distortions is very varied. For instance, the legislation on public procurement requires accreditation by tendering firms of a degree of solvency that is usually related to their turnover or their net worth and to public works executed in recent years. Start-ups have greater difficulty winning any tenders, irrespective of their productivity. But it is worth mentioning that the new public procurement legislation approved in 2018 made it possible for SMEs to tender by eliminating the accreditation of previous public works and reducing the number of years needed to demonstrate technical solvency. 9  See Almunia, M. and D. López-Rodríguez (2018): “Under the radar: The effects of monitoring firms on tax compliance”, American Economic Journal: Economic Policy, 10 (1), pp. 1-38.

The themes are broad. That reflects the diversity of our agenda. They focus on the interactions and intersections between policy areas. They emphasise new challenges and new directions, while recognising that familiar questions facing central banks remain no less important. Today’s conference is organised around them. The first theme covers “policy frameworks and interactions” The re-emergence of macroprudential instruments as part of the policy armoury raises fundamental questions about the interaction of monetary policy, macroprudential policy, and microprudential policy. It is essential to improve our understanding of the relationship between credit cycles and systemic risks. Since credit market developments both affect and reflect potential growth in the broader economy, they – and macroprudential measures to influence them – require careful study by financial and monetary policymakers alike. The advent of a new, enhanced policy toolkit raises vital questions about the effectiveness of individual policy tools; their joint operation; and how they interact domestically and across borders. The second theme covers “evaluating regulation, resolution, and market structures” The financial crisis precipitated a radical overhaul of the approach towards regulation, supervision and resolution. Regulatory policies have shifted from a near-exclusive focus on microprudential resilience to a more balanced emphasis on minimising systemic risk. In the whirlwind of essential change, there has been, however, relatively little assessment of the overall effect of reform on the financial system as a whole. Moreover, our understanding of the “system” must extend well beyond the banking sector to encompass the whole of market-based finance.