By Pablo Martín-Aceña, Ángeles Pons & Concepción Beltrán
Like the rest of the world, Spain has suffered frequent financial crises and undergone several changes in its regulatory framework. There have been crises that have been followed by reforms of the financial structure, and also troubled financial times with no modification of the regulatory and supervisory regime. In various instances, regulatory changes have predated financial crises, but in others banking crises have occurred without reference to changes in the regulatory regime. Regulation and supervision has been usually absent in the XIXth century, while in the XXth century policy makers have been more active and diligent. Moreover, all major financial crises have been followed by intense financial restructuring, although as elsewhere banking restructuring and interventions not always have been successful (in fact, the cases of failures and mixed results overcome the successful cases). The paper provides a short history of the major financial crises in Spain from 1856 to the present, and also reviews the main financial reforms and the distinctive regulatory regimes that have been in place in this last 150 years time span.
This paper is representative of a series of recent contributions in a number of ways: first, the financial crisis of 2007-9 has opened opportunities to highlight the role of historians to help formulate public policy. Second, there is more to the financial crisis than events around 1929 and the so-called “Atlantic continuity”. As the authors argue, there are lessons to be learn even from economies in the “periphery” such as Spain (which even at times of “isolation” it has seen drops in real income and industrial production as a result of international events). Third, I think the authors summarize the crux of the discussion here:
But can we really prevent financial crises? Can we design a potent regulatory framework capable to assure the stability of the financial system against all kind ofeconomic events?