TY  - UNPD
A1  - Thiemann, Matthias
A1  - Aldegwy, Mohamed Sami
A1  - Ibrocevic, Edin
T1  - Understanding the shift from micro to macro-prudential thinking: a discursive network analysis
T2  - SAFE working paper series ; No. 136
N2  - While some economists argued for macro-prudential regulation pre-crisis, the macro-prudential approach and its emphasis on endogenously created systemic risk have only gained prominence post-crisis. Employing discourse and network analysis on samples of the most cited scholarly works on banking regulation as well as on systemic risk (60 sources each) from 1985 to 2014, we analyze the shift from micro to macro-prudential thinking in the shift to the post crisis period. Our analysis demonstrates that the predominance of formalism, particularly, partial equilibrium analysis along with the exclusion of historical and practitioners’ styles of reasoning from banking regulatory studies impeded economists from engaging seriously with the endogenous sources of systemic risk prior to the crisis. Post-crisis, these topics became important in this discourse, but the epistemological failures of banking regulatory studies pre-crisis were not sufficiently recognized. Recent attempts to conceptualize and price systemic risk as a negative externality point to the persistence of formalism and equilibrium thinking, with its attending dangers of incremental innovation due to epistemological barriers constrains theoretical progress, by excluding observed phenomena, which cannot yet be accommodated in mathematical models.
T3  - SAFE working paper - 136 
KW  - Banking Regulation
KW  - Systemic Risk
KW  - Formalism
KW  - Equilibrium Thinking
KW  - Discourse
KW  - Citation Network Analysis
Y1  - 2016
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/40068
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-400683
UR  - http://ssrn.com/abstract=2777484
PB  - SAFE
CY  - Frankfurt am Main
ER  -