Similarly, if the financial markets cease to function properly, be it because of unexpected events, excessive risk taking or misconduct, everybody is bound to lose. The negative externalities of a banking crisis can be huge, as we all well know. Therefore it is a in the public interest to design the regulatory framework and set up institutions, which reduce the probability of systemic crises.
Of course this is not to say that changes in the pool of available  1  BIS Review 38/2000  labour, such as improving job-seekers’ professional qualifications, are not necessary as well. And certainly the relative factor prices must also contribute to solving the problem. In this connection the future problems of an ageing population should also be borne in mind.