Which Way Goes Capitalism? : In Search of Adequate Policies in a Dramatically Changing World

In this title, a well-known academic economist and former finance minister gives a lucid and well balanced overview of the current financial turbulences that have hit the developed economies. Strongly criticizing the excesses of neoliberal capitalism, Daianu calls for implementing necessary regulatory reforms in the financial sector and for restoration of a proper balance between the functions of the state and the market. Daianu goes back to some of the roots of the current crisis and the flaws or weaknesses of the global financial system. In doing so, he extensively discusses the monetary union of the Euro, and the critical question whether, how and when additional countries can and should join the club. This is a timely volume with a very strong and important warning. Table of Contents Foreword Acknowledgements Introduction. Return to Common Sense Is Needed Chapter 1. Institutional and Policy Diversity as an Engine of Economic Development Introduction I. What Influences Institutional and Policy Diversity? II. An Historical Perspective III. Examining the Record IV. Where Do We Stand? V. Transition Economies and Institutional and Policy Diversity VI. Concluding Remarks References Chapter 2. Ethical Lapses of Capitalism: How Serious They Are I. Introduction II. Ethics and Economy III. Understanding Micro and Macro Behaviours IV. Institutional Responses to Ethical Lapses V. Conclusion: Whither Capitalism? References Chapter 3. Why This Financial Crisis Is Occurring—How to Respond to It I. Introduction II. A Classification of Financial Crises III. The Current Crisis—What Has Triggered It and Its Implications IV. How to Respond to This Crisis V. Summing Up References Chapter 4. What This Financial Crisis Tells Us Introduction I. The Calculation Debate Revisited II. Is Only Greed to Be Blamed? III. What This Crisis Teaches Us IV. Limits of Openness References Chapter 5. A Strained European Model—Is Eastern Enlargement to Blame? I. Introduction II. The ESM and the Roots of Its Strain III. The Race for Competitiveness IV. Who Fears Globalisation? V. High Growth Rates Are Not Enough: The Case of Central Europe VI. The Future of the ESM References Chapter 6. The Monetary Union: The Decade Ahead. The Case of Non-Member States I. Introduction II. The First Decade of Monetary Union III. Old and New Challenges for the Monetary Union IV. Challenges for the New Member States V. Concluding Remarks References Chapter 7. The EU Budget Review: Managing Diversity for a Growing EU I. Introduction II. The History of the EU Budget: A Small Economic Instrument of Great Political Clout III. The European Union in the New Global Context: Challenges and Opportunities IV. Principles of the Reform V. Reviewing and Reforming the Budget: Concrete Measures to Take VI. Implementation of New Provisions VII. Concluding Remarks References Chapter 8. A Clash of Capitalisms Introduction I. Public Policy in Today’s World: A Plea for Open- Mindedness and Pragmatism II. Which Globalisation? III. The EU at “Midlife”: Cause for Celebration, but with Guarded Optimism IV. Capitalism vs. Capitalism in the 21st century V. Final Remarks References Epilogue. Keynes Is Back Appendix 1. European Parliament Resolution of 9 October 2008 with Recommendations to the Commission on Lamfalussy Follow-Up: Future Structure of Supervision (2008/2148(INI) Appendix 2. Financial Markets Cannot Govern Us Appendix 3. The Recurrence of Financial Crises in Economic History Appendix 4. Three-Month Inter-bank Spread Rates Over the Base Rate Index A well-known academic economist and former finance minister, at present member of the European Parliament, Daianu gives a lucid and well balanced overview of the current financial turbulences that have hit the developed economies. Strongly criticizing the excesses of neoliberal capitalism, calls for implementing necessary regulatory reforms in the financial sector and for restoration of a proper balance between the functions of the state and the market. A financial meltdown, with its very dire effects on the real economy, can be prevented by adopting proper policies and regulations