Reconstruction of the Old Institutions: Crisis, Governance, and the G20

Reconstruction of the Old Institutions: Crisis, Governance, and the G20

Ugur Yasin Asal (Istanbul Commerce University, Turkey) and Nazım Ekren (Istanbul Commerce University, Turkey)
Copyright: © 2020 |Pages: 16
DOI: 10.4018/978-1-7998-0333-1.ch003

Abstract

The recent global economic and financial crisis has fundamentally questioned the crisis management mechanisms of the international institutions. Despite the development of the skills of these institutions, financial vulnerability, economic imbalances, and the instability of the macroeconomic performance indicators are still rising cyclically. The G20 represents roughly 85% percent of global GDP and two-thirds of the world population. It emerged as a leading body for international economic performance. The lack of permanent secretariat of the G20 is decreasing the effectiveness, legitimacy, and the economic viability of the club. Regarding this philosophical background, the role of G20s' institutional structure is examined according to institutional capacity and the macroeconomic performance of the club.
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The Political Economy Of 2008 Global Financial Crisis And The Economic Governance

On the basis of the 2008 global financial crisis lies the large real estate and credit bubble that has emerged in the US and spread all over the world in waves. The Mortgage market in the US has become the largest market in the world with as size close to $ 10 trillion. First of all, ‘prime mortgage’ loans given to customers with secure reimbursement were a problem. Nevertheless, in a short while, it has been observed that ‘subprime mortgage’ loans were started to be defined to lower quality consumers. The amount of these loans reached to USD 1.5 trillion (Eğilmez, 2008, p. 66).

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