Franklin Allen and Douglas Gale, Understanding Financial Crises (Clarendon Lectures in Finance). Oxford University Press, 2007. 320 pages.
There are fewer bigger challenges in economic policy than "Understanding financial crises". But for all the evidence on crises assembled over many centuries, and their clear and significant costs, remarkably little analytical progress has been made in providing a consensus analytical model of crises. Allen and Gale have been at the frontier of theoretical thi