CRISIS – Complexity Research Initiative for Systemic InstabilitieS


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What is CRISIS?

CRISIS is the Complexity Research Initiative for Systemic Instabilities. It is a consortium of universities, private firms and policymakers that aims to build a new model of the economy and financial system that is based on how people and institutions actually behave.

It was set up in the wake of the global financial crisis that showed that existing models that had been adequate for the good times were utterly inadequate for predicting major crises.

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Why CRISIS is needed

The global financial crisis destroyed the faith that both policymakers and the general public had in the traditional economic models and thinking that had failed to foresee the disaster.

The CRISIS project aims to fill that gap by developing a new approach to economic modelling and understanding risks and instabilities in the global economy and financial system.

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Recent events

CRISIS Advisory Board Meeting

15 October 2014
Bank of England, London

The Project CRISIS team presented a selection of its results to senior figures from central banking, regulation, academia, and the financial services industry at a meeting of its Advisory Board.

The meeting was hosted by the Bank of England and the group had in-depth discussions on topics ranging from the dynamics of the leverage cycle, to methods for better understanding and identifying financial instabilities, new measures of systemic risk, and a wide range of policy issues including macro-prudential policy, the Basel regime, bank resolution schemes, and ideas for reducing systemic risk.

Please see the following link for the agenda, attendees, and presentations.

Latest research

Transparency key to credit regulation

Attempts to regulate the degree of leverage used by financial investors that ignore how leverage works risk doing more harm than good, according to research carried out by scholars in the CRISIS network.

Since systemic risk in times of high leverage is driven by the behaviour of different agents, regulation should focus on increasing transparency so that all creditors and borrowers could see the risks they were taking on.

External links

EC launches consultation on global systems science research

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