Fostering equity investment by addressing the debt-equity bias and improving financial literacy, for instance, would support the development of an equity culture in Europe, which would, in turn, help to finance innovation, growth6 and risk-sharing7, while also increasing the return on savings for households.
A second practical issue is whether there should be limits on foreign investments. The current thinking in industrialized countries is that the absence of limits on international investments allows for superior performance in terms of risk and return.