Conceptual, institutional, and practical impediments to developing a single framework for capital regulation are doubtlessly insuperable for the foreseeable future. But regulators with mandates covering different kinds of intermediaries, including the Federal Reserve, must keep both sides of this perspective in mind.
• The external deficit, the loss of competitiveness (in terms of unit labour costs) and labour market rigidities and constraints have been addressed. • There has been relative sectoral reallocation towards tradable goods and services.