scholarly journals International cooperation on financial market regulation

2021 ◽  
Author(s):  
Michael Abendschein ◽  
Harry Gölz
Keyword(s):  
Financial Market ◽  
Financial Stability ◽  
Financial Regulation ◽  
Global Financial Crisis ◽  
Local Level ◽  
Market Regulation ◽  
Financial Market Regulation ◽  
The Global Financial Crisis ◽  
Impure Public Good

AbstractAt the latest the global financial crisis has raised the awareness of the need for a globally coordinated financial market regulation. Even though the necessity to cooperate is widely acknowledged, cooperation is often limited in practice. This article characterizes the formation of self-enforcing international financial regulation agreements. Our analysis allows to evaluate the desirability and feasibility of cooperative solutions and explains the challenges associated with the process of cooperation. We model the cooperation of national financial regulators in a game-theoretical framework that considers financial stability to be an impure public good. Joint national supervisory effort is supposed to increase aggregate welfare in terms of a more stable financial system both on a global and on a local level by simultaneously generating incentives to free-ride. Our analysis in general indicates the difficulty of reaching a fully cooperative solution. In our basic version of the model we show that partial cooperation of two or three countries is stable and improves the welfare of all countries relative to the non-cooperative Nash equilibrium. Further analyses highlight the role of additional club benefits. When signatory countries of a coalition gain benefits over and above the joint welfare maximization, stable coalitions of any size become feasible.

Indirect Governance in Global Financial Regulation

2020 ◽  
pp. 203-222
Author(s):  
Thomas Rixen ◽  
Lora Anne Viola
Keyword(s):  
Financial Crisis ◽  
Financial Market ◽  
Financial Stability ◽  
Financial Regulation ◽  
Global Financial Crisis ◽  
Policy Reforms ◽  
Regulatory Standards ◽  
The Global Financial Crisis ◽  
And Control

The global financial crisis led G20 states to conclude that stronger regulatory standards and improved compliance were needed to ensure global financial stability. To this end, the G20, as collective governor, granted an institutional intermediary, the Financial Stability Board (FSB), authority to develop and supervise financial market regulations. However, the G20 designed the FSB in ways that stymied its regulatory competence. Why did the G20 design the FSB in ways that were inadequate to meeting its own governance goal? Competence–control theory provides a compelling answer. The G20 faces a tradeoff between a competent intermediary and control over the intermediary; this tradeoff is exacerbated by the G20’s collective nature. While the G20 has a collective long-term interest in an intermediary with the expertise and capacity to promote stability-enhancing regulations, intense short-term distributive conflicts among member states yield strong incentives to control the intermediary. These internal distributive conflicts are more easily overcome during systemic economic crisis, when a competent intermediary is urgently needed. Once the crisis has passed, however, the governor reasserts control, again compromising the intermediary’s competence. The chapter illustrates this argument with an account of reforming the Financial Stability Forum into the FSB, and three case studies of policy reforms after the financial crisis.

Global Financial Crisis and Financial Market Regulation: Updated Alarms and Market Architecture

2019 ◽  
Vol 2 (1) ◽  
pp. 106-112
Author(s):  
Dilbar Rustamova
Keyword(s):  
Financial Crisis ◽  
Financial Market ◽  
Global Financial Crisis ◽  
Market Performance ◽  
Market Regulation ◽  
Financial Market Regulation ◽  
The Global Financial Crisis ◽  
Impact Zones ◽  
Market Behaviour

This paper is structured around two vital problematic areas, such as financial market performance and integration of financial market regulation. It studies the roots, spread and impact zones of the global financial crisis, analysis the financial market behaviour and several regulative policies, and offers scientifically rooted practically proven improvement proposals for ensuring a sound financial market regulation.

Book Reviews

2012 ◽  
Vol 50 (3) ◽  
pp. 821-823
Keyword(s):  
Capital Flows ◽  
Financial Stability ◽  
Financial Regulation ◽  
Global Financial Crisis ◽  
Emerging Market ◽  
Central Banking ◽  
Financial Policies ◽  
Global Affairs ◽  
The Global Financial Crisis

Ashoka Mody of International Monetary Fund reviews “Growth with Financial Stability: Central Banking in an Emerging Market” by Rakesh Mohan. The EconLit abstract of the reviewed work begins: Explores the evolving roles of fiscal, monetary, and financial policies in India and their interaction and adaptation since India's independence, focusing on reforms since the early 1990s. Discusses the growth record of the Indian economy -- a story of sustained savings and investment; sustaining growth with stability -- the role of fiscal and monetary policies; innovation and growth -- role of the financial sector; development of banking and financial markets in India -- fostering growth while containing risk; development of the Indian debt market; financial inclusion in India; communication in central banks -- a perspective; volatile capital flows and Indian monetary policy; liberalization and regulation of capital flows -- lessons for emerging market economies; the global financial crisis -- causes, impact, policy responses, and lessons; emerging contours of financial regulation -- challenges and dynamics; and economic reforms in India --where we are and where we go. Mohan is Professor in the Practice of International Economics and Finance with the School of Management and Senior Fellow at the Jackson Institute of Global Affairs at Yale University. Index.

scholarly journals Finance and Jobs: How Financial Markets and Prudential Regulation Shape Unemployment Dynamics

2019 ◽  
Vol 12 (1) ◽  
pp. 20 ◽  
Author(s):  
Ekkehard Ernst
Keyword(s):  
Labor Market ◽  
Financial Markets ◽  
Financial Market ◽  
Global Financial Crisis ◽  
Financial Sector ◽  
Market Regulation ◽  
Economic Stability ◽  
Financial Market Regulation ◽  
The Global Financial Crisis ◽  
The Impact

This article explores the impact of financial market regulation on jobs. It argues that understanding the impact of finance on labor markets is key to an understanding of the trade-off between economic stability and financial sector growth. The article combines information on labor market flows with indicators of financial market development and reforms to assess the implications of financial markets on employment dynamics directly, using information from the International Labour Organization (ILO) datatabse on unemployment flows. On the basis of a matching model of the labor market, it analyses the economic, institutional, and policy determinants of unemployment in- and out-flows. Against a set of basic controls, we present evidence regarding the relationship between financial sector development and reforms and their impact on unemployment dynamics. Using scenario analysis, the article demonstrates the importance of broad financial sector re-regulation to stabilize unemployment inflows and to promote faster employment growth. In particular, we find that encompassing financial sector regulation, had it been in place prior to the global financial crisis in 2008, would have helped a faster recovery in jobs.

The Capital Market Authority Effectiveness in the Regulation of Financial Markets perspectives from the financial sector actors

2012 ◽  
Vol 02 (11) ◽  
pp. 15-24
Author(s):  
Charles Kombo Okioga
Keyword(s):  
Financial Markets ◽  
Financial Market ◽  
Capital Markets ◽  
Capital Market ◽  
Financial Regulation ◽  
International Standards ◽  
Market Regulation ◽  
Financial Market Regulation ◽  
Market Participants ◽  
New Business

Capital Market Authority in Kenya is in a development phase in order to be effective in the regulation of the financial markets. The market participants and the regulators are increasingly adopting international standards in order to make the capital markets in sync with those of developed markets. New products are being introduced and new business lines are being established. The Capital Markets Authority (Regulator) is constantly reviewing existing regulations and recommending changes to regulate the market properly. Business lines and activities are being harmonized by market participants to provide a one stop solution in order to meet the financial and securities services needs of the investors. The convergence of business lines and activities of market intermediaries gives rise to the diversity of a firm’s business operations to meet multiplicity of regulations that its activities are subject to. The methodology used in this study was designed to examine the relationship between capital markets Authority effective regulation and the performance of the financial markets. The study used correlation design, the study population consisted of 30 employees in financial institutions regulated by Capital Markets Authority and 80 investors. The study found out that effective financial market regulation has a significant relationship with the financial market performance indicated by (r=0.571, p<0.01) and (r=0.716, p≤0.01, the study recommended a further research on the factors that hinder effective financial regulation by the Capital Markets Authority.

Transparency Regulation in Financial Markets – Moving into the Surveillance Age?

2011 ◽  
Vol 2 (3) ◽  
pp. 305-321
Author(s):  
Iris H-Y Chiu
Keyword(s):  
Financial Crisis ◽  
Financial Markets ◽  
Financial Regulation ◽  
Global Financial Crisis ◽  
Financial Sector ◽  
Regulatory Control ◽  
Legal Reforms ◽  
The Global Financial Crisis ◽  
Risk Oversight

In the wake of the global financial crisis, the trajectory of legal reforms is likely to turn towards more transparency regulation. This article argues that transparency regulation will take on a new role of surveillance as intelligence and data mining expand in the wholesale financial sector, supporting the creation of designated systemic risk oversight regulators.The role of market discipline, which has been acknowledged to be weak leading up to the financial crisis, is likely to be eclipsed by a more technocratic governance in the financial sector. In this article, however, concerns are raised about the expansion of technocratic surveillance and whether financial sector participants would internalise the discipline of regulatory control. Certain endemic features of the financial sector will pose challenges for financial regulation even in the surveillance age.

Financial Market Regulation and Opportunities for Accounting Research

2012 ◽  
Vol 26 (3) ◽  
pp. 563-581 ◽  
Author(s):  
Mark J. Kohlbeck ◽  
Susan D. Krische ◽  
Nancy R. Mangold ◽  
Stephen G. Ryan
Keyword(s):  
Financial Market ◽  
Financial Institutions ◽  
Financial Regulation ◽  
Panel Discussion ◽  
Market Regulation ◽  
Wall Street ◽  
Financial Market Regulation ◽  
Accounting Research ◽  
Consumer Protection Act ◽  
Regulation Of Financial Markets

SYNOPSIS A concurrent session at the 2011 American Accounting Association Annual Meeting featured the panel discussion “Financial Market Regulation and Opportunities for Accounting Research.” Structuring their comments around their unique interests and expertise, the panelists covered diverse topics on the regulation of financial markets and financial institutions, including current activities of the primary financial market regulators responsible for accounting and auditing oversight, the Dodd-Frank Wall Street Reform and Consumer Protection Act, and the financial regulation of financial institutions from an economist's perspective. This paper summarizes the panelists' prepared remarks, which were followed by questions and comments from the audience.

scholarly journals A new paradigm of modern central banking

2013 ◽  
Vol 2 (2) ◽  
pp. 75-78
Author(s):  
Aleksandra Szunke
Keyword(s):  
Monetary Policy ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Central Banks ◽  
Central Banking ◽  
First Century ◽  
Financial Instability ◽  
New Paradigm ◽  
The Global Financial Crisis

The changes in the modern monetary policy, which took place at the beginning of the twenty-first century, in response to the global financial crisis led to the transformation of the place and the role of central banks. The strategic aim of the central monetary institutions has become preventing financial instability. So far, central banks have defined financial stability as a public good, which took care independently of other monetary purposes (Pyka, 2010). Unconventional monetary policy resulted in changes the global central banking. The aim of the study is to identify a new paradigm of the role and place of the central bank in the financial system and its new responsibilities, aimed at countering financial instability.

Money laundering and financial stability: does adverse publicity matter?

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Bahriye Basaran-Brooks
Keyword(s):  
Money Laundering ◽  
Financial Stability ◽  
Global Financial Crisis ◽  
Banking System ◽  
Public Confidence ◽  
Content Type ◽  
Reputational Risk ◽  
The Global Financial Crisis ◽  
The Impact

Purpose Already suffering reputational damage from the global financial crisis, banks face a further loss of trust due to their poor money laundering (ML) compliance practices. As confidence-driven institutions, the loss of reputation stemming from inadequate compliance with regulations and policies labels banks as facilitators of crime and destroys public trust both in the bank itself, peer banks and the wider banking system. Considering the links between financial stability and adverse publicity about banks, this paper aims to critically examine the implications of ML-specific bank information on financial stability. Design/methodology/approach This paper adopts a content analysis and a theoretical discussion by critically evaluating the role of bank compliance information on stability with references to recent case studies. Findings This paper establishes that availability of information regarding a bank involved in or facilitating ML might pose a threat to financial stability if bank counterparties cut their ties with the bank in question and when bank stakeholders show a strong and sudden negative reaction to adverse publicity. Though recent ML scandals have not caused immediate instability, general loss of confidence associated with reputational risk have had a destabilising effect on affected banks’ capital and liquidity. Originality/value There has been surprisingly little discussion to date on the impact of publicly available bank information on financial stability and public confidence within the ML compliance framework. This paper approaches the issue of publicly available banking compliance information solely through the prism of public confidence and reputational risk and its impact on macro-stability by examining recent ML scandals.

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