Pisani-Ferry, Jean, (2013), “The Politics of Moral Hazard”, www.project-syndicate.org, 30 March.
It is an old and never-ending contest. On one side are the moral-hazard scolds, claiming that one of the major responsibilities confronting policymakers is to establish incentives that demonstrate that imprudent behavior does not pay. On the other side are the partisans of financial stability, for whom confidence in the financial system is too precious to be endangered, even with the best possible intentions.