Perspectives On Policy Response Flashcards

1
Q

Keynesian approach on policy response

A

-provide strong monetary and fiscal stimulus

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2
Q

Austrian approach

A

Avoid bailouts (lead to moral hazard)

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3
Q

Strategies for avoiding future financial crises

A
  • floating XR
  • build up foreign currency reserves (avoid liquidity runs on banks)
  • regulation
  • improved public and private sector debt
  • structural reforms
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