Global Markets Institute: Effective Regulation - Part II: Local Rules, Global Markets （英語原文）

In the second of two papers on financial-market regulation, we look at the specific but important issue of where financial activity takes place, and why this matters. Capital is mobile, making financial-market activities inherently cross-border, but regulation is local. Regulatory choices have allowed some countries – notably the UK, Hong Kong and Singapore – to develop outsized capital markets, while different choices have limited others – Germany, Japan and to some extent the US – to markets that are undersized relative to their economic weights.

If the controls enacted in the wake of the current crisis simply cause financial activity to move to less well-regulated and well-supervised environments, then these controls will have failed. After all, if we have learned anything, it is that financial problems move across borders. Rules that force activity to flee often have the unfortunate effect of reducing oversight without reducing risk, leaving regulators to clean up a mess that originated elsewhere, often with limited ability to address the root problem directly. Containing risk to areas where regulation is best structured and applied is, therefore, the optimal long-term solution.

>> Effective Regulation: Part 2 - Local Rules, Global Markets [PDF, 545 KB]