scholarly journals FINANCIAL INSTABILITY HYPOTHESIS (FIH) OF MINSKY: CONTEXTUALIZING THE ROLES OF ISLAMIC COMMERCIAL AND SOCIAL FINANCE

2017 ◽  
Vol 2 (2) ◽  
pp. 145-172
Author(s):  
Ugi Suharto
Keyword(s):  
Financial Stability ◽  
Descriptive Analysis ◽  
Financial System ◽  
Point Of View ◽  
Theory And Practice ◽  
Islamic Finance ◽  
Social Aspect ◽  
Financial Instability ◽  
The Stability ◽  
Finance Theory

The main subject of this paper is to discuss some issues in Minsky’s Financial Instability Hypothesis (FIH) and relate them with Islamic finance position in enhancing the stability of financial system. The methodology used in the paper is descriptive analysis. It describes a particular concept, namely the financial instability hypothesis and then analyses, applies and compares that concept with other concept, i.e. the Islamic finance concept. It is shown in the paper that Islamic finance, both in its commercial and social aspect, can play its role in stabilizing financial system. The significant contribution of the paper is by bringing together the hypothesis of Minsky with Islamic finance theory and practice. It should be stated here, however, that among the limitations of the paper is that the reference on Minsky’s point of view is mostly based on his brief article entitled “The Financial Instability Hypothesis” without referring to his vast writings on various topics directly or indirectly related to his notion of Financial Instability Hypothesis. Keywords:  Financial stability, Islamic finance, Financial crisis, Deregulation, Riba, GhararJEL Classification: A12, E44, E58, G18, G21

scholarly journals SUSTAINABILITY OF THE FINANCIAL SYSTEM OF THE REGION: ISSUES OF THEORY AND PRACTICE

2020 ◽  
pp. 95-102
Author(s):  
О.В. Гончарук ◽  
Ю.Е. Путихин
Keyword(s):  
Financial Stability ◽  
Financial System ◽  
Financial Sector ◽  
Theory And Practice ◽  
Practical Significance ◽  
Insurance Companies ◽  
Municipal Finance ◽  
The Russian Federation ◽  
The Stability ◽  
Definition Of

В статье с позиций общего методологического анализа понятия «устойчивость» обоснована теоретическая и практическая значимость использования понятия «устойчивость финансовой системы региона», проанализированы подходы к раскрытию особенностей понятий финансовой устойчивости нефинансовых организаций, банков и страховых компаний, проанализированы подходы к определению понятия финансовой системы страны/ региона и ее структуры. В качестве основополагающего для целей анализа устойчивости финансовой системы региона выбран подход, в рамках которого финансовая система региона рассматривается как совокупность взаимодействующих и взаимосвязанных между собой таких секторов как сектор государственных и муниципальных финансов, финансовый сектор региона, региональный сектор корпоративных и личных финансов. Показана неравномерность развития отдельных институтов финансового сектора Российской Федерации и проанализированы основные показатели развития секторов финансовой системы страны за период 2016-2020 гг. Изложены методические подходы Банка России к исследованию финансовой стабильности. Предложено авторское определение «устойчивость финансовой системы региона» и совокупность параметров и показателей для оценки устойчивости секторов финансовой системы региона. The article substantiates the theoretical and practical significance of using the concept of "stability of the financial system of the region" from the standpoint of a general methodological analysis of the concept of "stability", analyzes approaches to revealing the features of the concepts of financial stability of non-financial organizations, banks and insurance companies, analyzes approaches to defining the concept of the financial system of a country / region and its structure; as a fundamental approach for the purposes of analyzing the stability of the financial system of the region, the approach is chosen in which the financial system of the region is considered as a set of interacting and interconnected sectors: the sector of state and municipal finance, the financial sector of the region, the regional sector of corporate and personal finance. The uneven development of individual institutions of the financial sector of the Russian Federation is shown and the main indicators of the development of the country's financial system sectors for the period 2016-2020 are analyzed. The methodological approaches of the Bank of Russia to the study of financial stability are described. The author's definition of "stability of the financial system of the region" and a set of parameters and indicators for assessing the stability of the financial system sectors of the region are proposed.

Influence of internal and external risks on sustainability of financial system of Аltai krai

2018 ◽  
Vol 35 (4) ◽  
pp. 133-136
Author(s):  
R. N. Ibragimov
Keyword(s):  
Sustainable Development ◽  
Financial Stability ◽  
Management Strategy ◽  
Financial System ◽  
Risk Management Strategy ◽  
The Sustainable Development ◽  
The Stability ◽  
The Impact

The article examines the impact of internal and external risks on the stability of the financial system of the Altai Territory. Classification of internal and external risks of decline, affecting the sustainable development of the financial system, is presented. A risk management strategy is proposed that will allow monitoring of risks, thereby these measures will help reduce the loss of financial stability and ensure the long-term development of the economy of the region.

scholarly journals Determinants of Polish financial stability in 2017-2018

2019 ◽  
Vol 30 (2) ◽  
pp. 5-19
Author(s):  
Kinga Górska ◽  
Karolina Krzemińska
Keyword(s):  
Financial Markets ◽  
Financial Stability ◽  
Banking Sector ◽  
Financial System ◽  
National Bank ◽  
The Stability

This article seeks to present the essentials of financial stability and to analyse and evaluate selected determinants of stability Poland’s financial system in the years 2017–2018. The study comprises exemplary ratios or indicators that are used in measuring the stability of a financial system. The proposed analysis is confined to selected groups of stability ratios/indicators that are pertinent to the macroeconomic situation, the situation in financial markets, and the situation of the banking sector. The analysis is based upon the data and statistics provided in the reports of the National Bank of Poland, available by 31st November 2018.

scholarly journals Macroprudential Policy Versus Other Economic Policies

2021 ◽  
Vol 23 (2) ◽  
pp. 33-66
Author(s):  
Eva Lorenčič ◽  
◽  
Mejra Festić ◽  
Keyword(s):  
Financial Crises ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Financial System ◽  
Policy Instruments ◽  
Economic Policies ◽  
Macroprudential Policy ◽  
Descriptive Research ◽  
The Stability ◽  
The Global Financial Crisis

After the global financial crisis of 2007, macroprudential policy instruments have gained in recognition as a crucial tool for enhancing financial stability. Monetary policy, fiscal policy, and microprudential policy operate with a different toolkit and focus on achieving goals other than the stability of the financial system as a whole. In ligh of this, a fourth policy – namely macroprudential policy – is required to mitigate and prevent shocks that could destabilize the financial system as a whole and compromise financial stability. The aim of this paper is to contrast macroprudential policy with other economic policies and explain why other economic policies are unable to attain financial stability, which in turn justifies the need for a separate macroprudential policy, the ultimate goal whereof is precisely financial stability of the financial system as a whole. Our research results based on the descriptive research method indicate that, in order to prevent future financial crises, it is indispensable to combine both the microprudential and the macroprudential approach to financial stability. This is because the causes of the crises are often such that they cannot be prevented or mitigated by relying only on microprudential or only on macroprudential policy instruments.

scholarly journals Financial Instability and Inequality Dynamics in the WAEMU

2017 ◽  
Vol 2 (1) ◽  
pp. 43-62
Author(s):  
Thierno Thioune
Keyword(s):  
Income Inequality ◽  
Financial Stability ◽  
West African ◽  
Economic And Monetary Union ◽  
Financial Instability ◽  
Impulse Responses ◽  
Vector Autoregressive ◽  
Synthetic Index ◽  
Negative Effect ◽  
The Stability

This article assesses the effect of financial instability on income inequality and vice versa. The methodology used in this article is based on two approaches: theconstruction of the synthetic index of financial instability (SIFI) and the panel vector autoregressive (PVAR) approach. The results obtained help to explain that the disparity of income in a West African Economic and Monetary Union (WAEMU) country in each year negatively influences the stability of the financial sector the following year. Functions of impulse responses show that a shock to financial stability has a negative effect on itself and leads to a stable situation after seven periods. A rise in income inequality in WAEMU countries tends to mitigate financial instability at first, before boosting a higher level of instability. Following this increase, inequality will decline, but at a very slow pace.

scholarly journals Macro-prudentiality and financial stability

2012 ◽  
Author(s):  
Cristian Ionescu
Keyword(s):  
Financial Crises ◽  
Financial Stability ◽  
Financial System ◽  
Financial Instability ◽  
Economic Policies ◽  
Prudential Regulation

Taking into consideration the fact that financial crises, as a manifestation form of the financial instability, are becoming more and more frequent, complex and severe, it is important to discuss about the macroeconomic prudentiality, in order to protect and save the economy of a country or of a region by the inherent fragility of a very developed financial system. Therefore, the paper aims to analyze the following aspects: the macro-prudential regulation (in order to a better understanding of the financial instability process), the development of the macro-prudential vision and instruments (but emphasizing the existing limits) and economic policies (in order to implement an operational macro-prudential regulation).

Impact of Crypto-Asset Trade on Financial Stability

2020 ◽  
pp. 210-232
Author(s):  
Nader Trabelsi
Keyword(s):  
Systemic Risk ◽  
Financial Stability ◽  
Financial System ◽  
System Stability ◽  
Copula Model ◽  
Copula Approach ◽  
The Stability ◽  
The Empirical Analysis ◽  
Global Financial System

The chapter attempts to test the hypothesis that cryptocurrencies are real independent financial instruments that pose no danger to global financial system stability. For the empirical analysis, the authors use data related to bitcoin and widely traded asset classes. They also utilize the copula approach as well as the CoVaR model. The results show a significant role of crypto-asset market in the stability of global markets. Precisely, they find a dependence between bitcoin and oil prices defined by a normal copula model. The empirical results regarding the systemic risk show that extreme changes in bitcoin prices may have an adverse effect on equity and gold markets. There are positive and significant effects of EUR, JPY, and WTI markets when bitcoin goes down. The authors have also shown that after 2016 the virtual market sudden changes are more likely to raise the whole regular financial system losses, except the energy market. These results are important for policymakers and investors.

scholarly journals How Islamic Finance can affect the Financial Stability?

2020 ◽  
Author(s):  
Sassi Mohamed Taher ◽  
Marius Kinski
Keyword(s):  
Empirical Evidence ◽  
Financial Stability ◽  
Financial System ◽  
Financial Sector ◽  
Islamic Finance ◽  
Theoretical Discussion ◽  
Conventional System ◽  
Future Challenges ◽  
Alternative Approaches

The subprime mortage crisis during the years 2007-2010 demonstrated the weaknesses of the conventional system of finance. The inherent speculative element of this system, which is fueled through the logic of interest additionally, brought attention to alternative approaches in order to recover control over the financial system. Islamic finance, a system relatively young in practice, contributed its part to the ongoing discussion on financial stability and has to present its own tools for this huge task. This paper wants to outline the ongoing theoretical discussion and empirical evidence concerning the question of financial stability and the role of Islamic finance in it. Main results found was Islamic finance has contributed to the overall financial stability. The survival of this financial system through the crisis of 2007-2008 has made it more and more interesting to investigate and to develop. The question of tradeoff between stability and profitability of this financial system remains under investigation as the conventional financial sector continues to be more profitable but less stable. The new avenue of the research channel in the financial sector could measure this tradeoff taking into account the future challenges.

scholarly journals Stabilność systemu finansowego Unii Europejskiej

Studia BAS ◽  
2021 ◽  
Vol 3 (67) ◽  
pp. 87-116
Author(s):  
Małgorzata Mikita
Keyword(s):  
Financial Stability ◽  
Stock Price ◽  
Banking System ◽  
Financial System ◽  
Price Volatility ◽  
System Stability ◽  
Volatility Index ◽  
Degree Of Stability ◽  
The Stability ◽  
The Eu

The aim of the article is to present activities undertaken at the EU level to ensure financial stability, and to assess the degree of stability of the EU financial system on the basis of selected indicators. The first part of the article introduces the concept of financial system stability and describes its importance in the modern economy and the methods of estimating the stability of the financial system. The second part of the article is devoted to the presentation of activities undertaken by the EU to increase the stability of the financial system, and the assessment of financial stability on the basis of two indicators: the Z-score indicator, used to assess the stability of the banking system, and the Stock Price Volatility index, showing the stability of the capital market.

scholarly journals DAMPAK INKLUSI KEUANGAN TERHADAP STABILITAS SISTEM KEUANGAN DI ASIA

2016 ◽  
Vol 18 (4) ◽  
pp. 409-430 ◽  
Author(s):  
Azka Azifah Dienillah ◽  
Lukytawati Anggraeni
Keyword(s):  
Financial Stability ◽  
Pearson Correlation ◽  
Financial System ◽  
Fixed Effect Model ◽  
Financial Inclusion ◽  
Gdp Per Capita ◽  
Asian Countries ◽  
Effect Model ◽  
Per Capita ◽  
The Stability

Financial inclusion is one of strategy to increase inclusive growth in Asian countries. However, it may cause either stability or instability in the financial system. Therefore, this research aimed to analyze the relationship between financial inclusion and financial stability and to analyze factors that affect the stability of the financial system in seven Asian countries in the periode of 2007-2011. The methods used are Pearson correlation and Fixed Effect Model. The results show that there is negative correlation at 5% significant level between financial inclusion and financial stability. Factors that significantly affect the financial stability are financial inclusion, financial stability in the previous period, non-FDI capital flows to GDP, the ratio of current assets to deposits and Short-term funding, and GDP per capita. Thus the increase in financial inclusion, current assets of banking, GDP per capita, and the portfolio investment can become the strategies to improve the financial stability (Bank z score) on the determined and future year.

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