Government Bailout and International Policy Coordination in Financial Crisis

Abstract

Abstract:

Based on government bailout practices in major financial crises, this paper summaries the evolution of government bailout and international coordination mode for the subprime and the European debt crisis. And meanwhile, it proposes a classification and evaluation of rescue measures and effects under different crises. It shows that government bailout plays a leading role in crisis rescue. The most effective measures for crisis relief are traditional monetary policy and fiscal policy. Unconventional policies promote financial stability in a short period of time, but the final choice of policy needs to be weighed under the principle of comprehensive balance between short-term and long-term benefits. The evolution trend of financial crisis rescue and international coordination is characterized by the diversification of intervention subject, the expansion of rescue areas, the innovation of tools and the multi-way of extension. The international coordination has become crucial in reducing the negative cross-border spillovers. High-efficient and proactive international coordination and crossborder cooperation exit will be a powerful guarantee for the effectiveness of crisis relief.

Key words: financial crisis, government bailout, international coordination

Kou Mingting, Yang Haizhen, Yang Xiaoguang. Government Bailout and International Policy Coordination in Financial Crisis[J]. , 2019, 31(10): 10-22.

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