Of course, one should not neglect the domestic inefficiencies in advanced economies that allowed the  3  Ricardo J. Caballero, Emmanuel Farhi, and Pierre-Olivier Gourinchas: “An Equilibrium Model of “Global Imbalances” and Low Interest Rates”, American Economic Review 2008, 98:1, pgs 358–393. 2  BIS central bankers’ speeches  financial crisis to occur in the first place.
Some reforms have recently been undertaken, both at the national and the European level. For example, personal tax wedges have been reduced and employment protection legislation has been relaxed in some European countries. And I fully support the current EU Commission initiative for measuring the cost of existing legislation and reducing the administrative burden on companies with 25 percent by 2012.