The Finance System As Global Public Goods And The Regeneration Of Global Communities


Research Organisation
Chuo University & Mitsubishi UFJ Kokusai Asset Management

Report Date
Jan. 20, 2016

Document summary

In 2014 and 2015, the two referenda of Scotland and Greece have focused on costs and benefits of the cooperation in the global community. Theoretically, the deadweight loss of the global public goods could guide us to reach the cause and the impact of the potential crisis on the sustainable community. In addition to deteriorating global environmental problems, the provision of energy, foods, fresh water may be written into the list of insufficient public goods from the world point of view. The financial system is classified also as the global public goods. The fail of the financial system in the particular country will require the cooperation among many states and organizations.

Since each member obtains different costs and benefits for the global issues, the way to the consent among the members should contain complicated repercussions and negotiations. If many participants of the international negotiation could confirm the common method of cost and benefit in the global community, the feasible options will converge in relatively limited scope. The approach investigated by this paper could lead global community to stable and sustainable solutions without needless failures in the negotiation process. This paper argues that the member in the origin of the global crisis should owe more than 29.3 % contribution of the total responsibility.

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