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Abstract

This paper describes a financial system that should be adopted for the 21st century. The paper highlights that the financial crisis of 2008 has raised fundamental questions about how the financial industry is structured, managed, and regulated. The paper discusses that a well-functioning financial system plays an essential role in generating high levels of saving, promoting the efficient allocation of investment, and smoothing economic fluctuations stemming from nonfinancial causes. By facilitating informed risk taking, it is a key element in achieving optimal levels of productivity growth and rising living standards.

Per Jacobsson Foundation

2011

ISSN 0252-3108

Editor: Michael Harrup

Cover design and production: IMF Multimedia Services Division

Composition: Maryland Composition, Inc.

The Per Jacobsson lectures are available on the Internet at www.perjacobsson.org, which also includes further information on the Foundation. Copies of the Per Jacobsson lectures may be acquired without charge from the Secretary.

Contents

  • Foreword

  • Opening Remarks

  • What Financial System for the Twenty-First Century?

    • Andrew Crockett

  • Questions and Answers

  • Panel Discussion

  • Biography

  • Acknowledgments

  • The Per Jacobsson Lectures

  • The Per Jacobsson Foundation

Foreword

The first Per Jacobsson Foundation Lecture of 2011, “What Financial System for the Twenty-First Century?” was presented by Sir Andrew Crockett, who is currently Special Advisor to the Chairman of JPMorgan Chase. The lecture was held on June 26 in the auditorium at the head-quarters of the Bank for International Settlements in Basel, Switzerland, in conjunction with the BIS’s Annual General Meetings. Guillermo Ortiz, Chairman of the Per Jacobsson Foundation, moderated the event.

The Per Jacobsson Foundation was established in 1964 to commemorate the work of Per Jacobsson (1894–1963) as a statesman in international monetary affairs. Per Jacobsson was the third Managing Director of the IMF (1956–63) and had earlier served as the Economic Adviser of the BIS (1931–56). Per Jacobsson Foundation lectures and contributions to symposia are expressions of personal views and intended to be substantial contributions to the field in which Per Jacobsson worked. They are distributed free of charge by the Foundation. Further information about the Foundation may be obtained from the Secretary of the Foundation or may be found on the Foundation’s website (www.perjacobsson.org).

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What Financial System for the Twenty-First Century?