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Emerald Group Publishing Limited
Copyright © 2010, Emerald Group Publishing Limited
Article Type: Editorial From: Journal of Financial Economic Policy, Volume 2, Issue 1
The scope of important financial economic policy issues ranges far and wide. Some issues involve specific demographic groups or selected industries within particular geographic areas, while others involve far larger groups of individuals, firms, and industries that are spread over much broader areas and even many national borders. This, of course, is no surprise insofar as finance and economics permeate every aspect of the daily activity of individuals, firms, and governments in all countries around the world. It is for this reason that the Journal of Financial Economic Policy welcomes papers that focus on a wide variety of financial economic policy issues.
This particular issue demonstrates this very fact. The paper by Carolyn Sissoko addresses the timely and important policy issue of considering to what degree the US Bankruptcy Code contributed to the financial crisis. In particular, it is argued that “safe harbor” provisions in the Code helped destabilize the US financial system. As a result, the author concludes that financial reform must include a reassessment of the legal foundations of the US Bankruptcy Code. In a second paper, Michael Enowbi-Batuo and Mlambo Kupukile shift the focus to ways in which to promote financial development in African countries. Given the considerable challenges and opportunities in these countries, it is found that economic and financial liberalization have indeed contributed to financial development. The author also examines the role of political freedom in improving economic development and limitations to dynamic indigenous growth in African countries. The third paper by Wei-Bin Zhang uses a multi-country monetary growth model to examine the linkages between national monetary policies and global economic growth. It is argued that government intervention and co-operation among countries may be necessary to maintain global development under some seemingly plausible circumstances, as evidenced by the recent global financial crisis. In the last paper, Glenna Sumner and Anita Williams emphasize the role of contract enforcement in the recent financial crisis in the USA. It is argued that the uncertainty of contract enforcement increased required rates of return in investment projects, thereby lowering asset values. This is taken to mean that policy decisions that weaken contract enforcement can lead to a collapse in aggregate asset value.
James Barth, John Jahera