 Secondly, problems of market failures and market instabilities seem to be much more pervasive than has often been assumed, especially in complex, interrelated markets such as financial markets (cf. e.g., Minsky 1986, esp. ch. 9; on financial markets in general see also Herzog 2017). This means that it is far more difficult for states to regulate them. It has to do with the role of psychological effects such as herding (cf. e.g., Akerlof and Shilling 2003) and maybe also with massive imbalances of power within such markets, which are often caused by asymmetries of information or barriers to market entry. The consequences of regulatory changes are hard to predict when there are nonlinear causal chains and the reaction of “the markets” is difficult to anticipate, so that it is unclear how to evaluate their impact on society. This raises the question of whether states have to use a more flexible approach to regulating markets, or whether there might be ways of reducing the fragility of the global economic system.