Changes in the architecture include both improvements in macroeconomic surveillance and actions to establish a banking union. Economic governance has been improved through three main pillars: the so-called “six-pack”, the fiscal compact, and the “two-pack”.
First, make the market function more efficiently so that risk is priced correctly. If market failures occur and consequently the price mechanism doesn’t work, public policy should look into the incentives existing for financial market participants and - if need may be - adapt the framework. Too big an appetite for risk is at the heart of subsequent financial crises.