Consumer and business practices across a number of markets are changing, in some cases dramatically. In the end, there may be far-reaching and positive implications for the structure and efficiency of many of our markets. Three key sets of variables that are shaping electronic transactions and electronic commerce can be summarized under the headings of convenience, confidence, and complexity.
This phenomenon – known as pro-cyclicality – can for example be linked to the time-varying risk parameters for the calculation of capital requirements or the accounting framework. The need to address this excessive pro-cyclicality is a concern now shared by policy-makers globally.