Volatility in Spanish Financial Markets: The Recent Experience

The potential negative consequences of high financial volatility have been an important concern recently. Although its empirical relevance has not been proved conclusively, clear theoretic and intuitive arguments justify this concern. Many efforts have been conducted, therefore, to determine which is the relevant concept of volatility and how to measure it, which factors explain the course it follows, and which steps should be taken in order to curb volatility. In this paper, we present evidence on these issues focusing on the Spanish experience.