This paper discusses the role that financial innovations play in the modern financial system, aiming at identifying and systematizing the core problems and definitions related to this issue. The paper first describes the importance of the financial system and financial markets in the economy,...

Before the financial crisis securitization was commonly considered an efficient way of replacing illiquid assets with liquid securities (ABS), in which the risk was supposed to be adequately compensated by the tranching techniques. However, with the emergence of the crisis investors became more...

Systemic risk is a fundamental constituent of contemporary financial systems. For the past decades a growing number of abrupt upsets in financial systems could be observed. Due to previous experiences, politicians and regulators prefer to identify the off enders outside the system or to blame...

Compared to the U.S., the euro area has been underperforming in the wake of the Great Financial Crisis (GFC). This holds especially true for peripheral euro area economies. Whereas the U.S. is characterised by a financial system dominated by arms' length (capital-market oriented) interaction...

Viele Entscheidungen des täglichen Lebens erfordern ökonomische Kenntnisse. Es gibt somit gute Gründe, das Wissen über Wirtschafts- und Finanzthemen zu stärken. In Deutschland gibt es bislang für ökonomische Bildung keine federführende Institution. Vielmehr engagieren sich neben dem...

The volatile nature of exchange rates with the advent of floating regimes has received much attention in economic research. The volatility is generally perceived as negatively affecting international trade. While theoretical predictions and empirical outcomes appear mixed, the balance seems to...