As a team of authors we have followed the building of the European financial system from different angles. We have contributed to the academic literature on this topic. Moreover, one of us has been teaching a course on European Financial Integration, from which this book has emerged. On the policy side, the authors have been directly involved in the work of national administrations (i.e. the Ministry of Finance, the Ministry of Economic Affairs in the Netherlands, and the Dutch central bank) as well as the European institutions (i.e. the Council, the European Commission, and the European Central Bank). As part of our job, two of us have participated in many meetings in Brussels discussing the future of European financial markets and institutions, and negotiating new European financial services directives.
The authors would like to thank Wilco Bolt, Jean Frijns, Ronald Heijmans, Iman van Lelyveld, Albert Menkveld, Almoro Rubin de Cervin, Martijn Schrijvers, Casper de Vries and Peter Wierts for their advice on specific chapters. We thank Martin Admiraal, René Bierdrager and Henk van Kerkhoff for their statistical support.
What is new in the third edition?
Since the first edition of this book, the world's financial system has been through its greatest crisis for a century. What made this crisis unique is that severe financial problems emerged simultaneously in many different countries, and its economic impact was felt throughout the world as a result of the increased interconnectedness of the global economy. Financial innovation also played an important part in the financial crisis. Two chapters deal with (1) financial crises, including an overview of the causes and consequences of the 2007–2009 financial crisis as well as the more recent euro crisis, and (2) financial innovation, including the role of securitisation and the shadow banking system.
In the third edition, the chapters on financial markets and institutions have been updated with new data through 2014 whenever possible.