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Full-Text Articles in Banking and Finance Law
Recursive Collective Actions Problems: The Structure Of Procyclicality In Financial And Monetary Markets, Macroeconomies And Formally Similar Contexts, Robert C. Hockett
Recursive Collective Actions Problems: The Structure Of Procyclicality In Financial And Monetary Markets, Macroeconomies And Formally Similar Contexts, Robert C. Hockett
Cornell Law Faculty Publications
The hallmark of a collective action problem is its aggregating multiple individually rational decisions into a collectively irrational outcome. Arms races, “commons tragedies” and “prisoners’ dilemmas” are well-known, indeed well-worn examples. What seem to be less widely appreciated are two complementary propositions: first, that some collective action problems bear iterative, self-exacerbating structures that render them particularly destructive; and second, that some of the most formidable challenges faced by economies, societies, and polities are iteratively self-worsening problems of precisely this sort. Financial markets, monetary systems and macroeconomies in particular are rife with them – as are other complex systems subject to …
A Fixer-Upper For Finance, Robert C. Hockett
A Fixer-Upper For Finance, Robert C. Hockett
Cornell Law Faculty Publications
Three facts bear notice in connection with our current financial troubles. The first is that the First World War, before the Second began, was known as "the Great War." The second is that the global Depression that struck between those two wars, which for now we can still label "Great," commenced with the burst of a multiyear real estate price bubble prior to the 1929 stock market crash. The third is that the U.S. accordingly addressed that depression through mutually reinforcing new regimes not only of financial regulation, but also of home mortgage finance - the very reforms that brought …