indicator. The existing approaches to indicators of financial stability development (in
particular, approaches of IMF) describe only some sides of financial stability and do
not reflect non-linear feedbacks on the macro level and systemic risks. It is clear that
these approaches are only the first steps in understanding of complex nature of financial
stability. That is why these financial stability indicators do not give a complete picture
of growing financial instability systemic risks and impending crisis.
We could continue the existing monetary paradoxes list; however, these are
enough to reach a conclusion about the serious methodological gaps in the financial
stability fundamental basis sphere.
What kind of universal financial stability definition could be? The eminent
scientist George Joseph Stigler (Nobel Memorial Prize in Economic Sciences, 1982)
was formulated the fundamental economic theory methodological problem that
consists in traditionally researchers insufficient attention to precise and accurate
definitions of used conceptions, initial pre-conditions validity, and existence implicit
presuppositions, which imply from a context. In particular, there is an obstacle remains
in the financial stability context research. Stigler formulated the basic requirements to
the necessary exactness level and analytical value of the entered definitions. He wrote
that the entered definition must determine a model with such level of exactness, which
the current state of science allows. This model has to allow using it by professionals in
different theoretical researches without necessity to discuss fundamental bases at every
expansion or application of theory. The definition must grasp the inner essence of the
phenomenon under study and create a methodological basis for empirical reliability of
theoretical predictions.
In the next paragraph, we describe an approach to understanding the financial
stability. It seems to us that suggested definition meets these requirements.
Financial stability as a systemic dynamic phenomenon. The well-known
scientist Nils Bor said that adequate description of complex phenomena is possible
only with language that has corresponding complexity level. Practice shows that
ignoring this general methodological principle in the financial stability sphere leads to
puzzles and paradoxes in the monetary and financial regulation sphere.
Let us clear the explicit and implicit methodological presuppositions that
dominate in modern researchers’ minds when they investigate problems of financial
stability:
1) financial stability is certain characteristic of financial system;
2) the concept of «financial system» has narrow sense as a set of financial
institutions (bank and non-bank financial organizations), financial markets and
financial infrastructure;
3) authors suggest different stability consequences descriptions or instability for
an economy as a financial stability definition;
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