When Lehman Brothers collapsed and the global financial crisis erupted five years ago, many glimpsed a silver lining: the promise of more effective global economic governance. But, despite a flurry of early initiatives, the world remains as far from that goal as ever.
In a comment piece for Project Syndicate Professor Ngaire Woods, GEG’s Director, examines the response and effectiveness of international institutions to the 2008 financial crisis. There is an urgent need for international cooperation to manage and respond to the crisis, but institutions such as the IMF and World Bank have been falling considerably short of their commitments. Current financial regulation is far from comprehensive, emergency lending has been slow and limited, and G20 legal frameworks and enforcement powers are patchy. Professor Woods suggests that these weaknesses are encouraging further financial fragmentation, as countries are increasingly finding their own ways to manage and regulate finance.
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