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The paper gives a concise evaluation of the impacts of the global economic crisis on the Estonian economy in 2009-2010. The main activities performed in the Estonian economy for the alleviation of the crisis have been pointed out. The state budget and its cuts are dwelt upon. Changes in the Estonian economy within the last few years are presented with the related brief assessments. The measures officially planned by government agencies for the current and further stabilisation of the Estonian economy are described. The main activities that should be performed in Estonia in the opinion of the author for the alleviation of and exiting the crisis are pointed out. As overcoming the economic crisis and achievement of subsequent stable development assumes also carrying out several reforms, the paper also briefly dwells on the problems related to the achievement of regional balance and the administrative-territorial reform

ZusammenfassungDieser Aufsatz untersucht den Einfluss politisch‐institutioneller Faktoren auf das langfristige Wirtschaftswachstum zwischen 1960 und 1992, wobei der Fokus auf den Effekt politischer Stabilität und politischer Regime auf die ökonomische Entwicklung gelegt wird. Hinsichtlich der Bedeutung der politischen Stabilität für die ökonomische Entwicklung wird gezeigt, dass schwere inner‐ und zwischenstaatliche Konflikte die ökonomische Entwicklung hemmen, während schwelende und sporadische Konflikte keinen Bremseffekt auf das Wirtschaftswachstum ausüben. Bezüglich des Einflusses politischer Regime auf das Wirtschaftswachstum wird die Hypothese vertreten, dass ein simpler Demokratie‐Diktatur‐Vergleich zu kurz greift. Die empirischen Befunde sprechen vielmehr dafür, dass sowohl Autokratien als auch Demokratien mit langfristigem Wirtschaftswachstum kompatibel sind, sofern wirtschaftliche Eigentums‐ und Verfügungsrechte garantiert werden und diese rechtsstaatlich abgesichert sind. Hält man den Entwicklungsstand dieser Institutionen konstant, zeigt sich ein nichtlinearer Zusammenhang zwischen dem Demokratisierungsniveau und dem langfristigen Wirtschaftswachstum.

"If interest rates (country spreads) rise, debt can rapidly be subject to a snowball effect, which then becomes self-fulfilling with regard to the fundamentals themselves. This is a market imperfection, because we cannot be confident that the unaided market will choose the good equilibrium' over the bad equilibrium'. We see here a fundamental flaw in the process of market discipline. We propose a policy intervention to deal with this structural weakness in the mechanisms of international capital flows. This is based on a simple taxonomy that enables us to break down the origin of crises into three components: a crisis of confidence (spreads and currency crisis), a crisis of fundamentals (real growth rate), and a crisis of economic policy (primary deficit). The policy would seek to short-circuit confidence crises, partly by using IMF support to improve ex ante incentives"--National Bureau of Economic Research web site

Due to the lack of political salience that financial stability policy enjoys in tranquil economic times, this policy field lends itself particularly well to capture – the more so the more important the role of banks is in the financial system. Gundbert Scherf's research focuses on this nexus between integrated banking, supranational monetary policy and national banking regulation. He finds that national level differences in financial systems and related institutions explain and drive variation in regulatory financial stability policy across countries.