Financial System Stability and Social Welfare

The financial system has an important role for economic growth and social welfare of individuals, households, enterprises, civic and public institutions. Despite its imperfection, the financial system has the power to help us create a better and a more fair society, having an essential role in the development of wealthy economies. The recent financial crisis is the largest, most complex and delicate challenge of the current period. Authorities are deeply concerned with improving the existing framework of supervision and regulation and develop strategy programs in order to ensure stability and sustainable growth throughout Europe. The European Council has adopted the Europe 2020 Strategy which is the EU's growth agenda for the current decade. It aims at overcoming the negative effects of the global financial crisis and emphasizes sustainable economic development and social inclusion. The fundamentals of the Europe 2020 Strategy are the five key objectives: employment, R&D expenses, climate change and energy sustainability, education and fighting poverty and social exclusion. Reviewing the impact of financial stability on social and economic development reveals low employment rates both for the EU and Romania. Current descriptive statistics analysis shows that the employment rate is higher for a higher level of education of the population considered sustaining education and training development as fundamental priority. Although R&D and innovation are key policy components of the Europe 2020 strategy, the rates are still low, especially in Romania. Having more innovative products and services on the market addresses job creation through increased industrial competitiveness, productivity and efficient use of resources.