Questions tagged [regulation]
The regulation tag has no usage guidance.
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Deregulation by Trump
It is said that President Trump has gotten rid of more financial regulations than other presidents in American history, and that this is the reason why the economy has been doing so well (minus or pre-...
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37 views
How does a CLEC innovate?
A CLEC, competitive local exchange carrier, is described...
A competitive local exchange carrier (CLEC), in the United States and
Canada, is a telecommunications provider company (sometimes called a
&...
0
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0answers
18 views
How would consolidation in the brokerage space make things better for banks?
There is a bit from an article I don't quite understand:
China has been eager to whip its brokers into shape. Officials want
capital markets to lessen the burden on banks, which last year
provided ...
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vote
0answers
7 views
Do Fines Imposed by Regulators Improve Performance?
After receiving a fine, do companies immediately seek to recoup their loses or do they take it on the chin?
I'm just wondering if it's the most efficient way of deterring complacency or non ...
0
votes
1answer
31 views
Does price cap in emergency situation (COVID-19) reduce the availability of a good? Does unregulated market increase it instead?
I was discussing with one of my friend about Italy price cap on surgical mask to control speculation. He says price cap does not allow industries to invest more to increase the production that would ...
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0answers
25 views
Reason for SMEs in the European Union employing the bulk of people?
Is there any specific reason why SMEs in the European Union employ the vast majority of people in general as well as in certain industries? Are they exempt from certain regulatory burdens such as ...
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0answers
14 views
How can you define a commodity's level of pollution intensity?
I am doing a report on whether environmental regulation has an impact on goods exports for the UK (Using difference-in-differences). I have export data from 1990 to 2018 split by SITC codes. However, ...
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0answers
16 views
Minimum requirements under basel 3
Why is it that banks are told to maintain 4.5% of CET1 and capital conservation buffer of 2.5% of CET1 instead of 7 % of CET1???
2
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0answers
21 views
Is there a list of U.S. government regulations or actions that depend on government produced statistics?
I'm interested in compiling a list of government actions that depend on government produced figures. For example social security benefits depend on the CPI. I don't know if such a list already exists.
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Economic Regulation using Price caps
Based on my understanding both the equations are price caps, for firm A real decrease must be 8% and for B real increase must be 1%.
But I don't understand how will I choose between the 2 as an ...
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votes
1answer
53 views
How is market making not considered manipulation? [closed]
When I buy a stock I don't actually buy anything. My broker gives money to Goldman Sachs which gives a share at an arbitrary price. And they collect a profit on the difference between the price for ...
0
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2answers
56 views
Why is common stock included in bank capital?
Capital represents the loss-absorbing capacity of a bank. I do not understand how shares issued in the past provide any indication of a bank's loss-absorbing capacity. I understand that common equity ...
1
vote
1answer
73 views
Cournot's game profit maximisation first order condition question
My question is about the last part (I attached the rest for context). I don't understand the final line at all. I thought the first order condition would just be to set the derivative = 0. Very ...
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vote
0answers
14 views
China approval for US company acquisition
Why does China has to give approval to two US companies merging together?
There have been quite a few examples in the last time, as UTC & Rockwell Collins as well as Qualcomm acquiring NXP ...
1
vote
0answers
108 views
Can one single payment contain multiple Merchant Category Codes (MCC)? [closed]
Some payment cards can be limited for certain purposes only (e.g. for paying only for food, or only for car fuel). When you try to pay for a different purpose, the system rejects the payment.
I ...
0
votes
1answer
68 views
What are the arguments for banning insider trading?
I can't see any economic argument for banning insider trading. In general, the point of allowing financial securities to be traded is to ensure that they are properly valued. "Insiders" seem better ...
2
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0answers
60 views
Size and influence of the regulatory/supervisory sector
I am interested in the size of what I call the regulatory/supervisory sector in Western economies. A regulatory/supervisory (R&S) activity involves either:
Determining a set of rules economic ...
2
votes
1answer
93 views
Can't government experiment on price in the case of a monopoly?
In the lecture given by Jon Gruber at MIT, he talks about the governmental regulations on monopolies, and he states that
(in short)
for government to regulate a monopoly, it needs to know the price ...
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0answers
14 views
What were the liquidity requirements prior to Basel III?
I am investigating the impact of enforcing the Basel III liquidity requirements with a focus on the LCR. I have found some information about regulations in fore prior to Basel III in Sweden and ...
1
vote
1answer
1k views
What's the Difference Between Being Pro-business and Being Pro-market?
In a recent interview I watched a economist say something along the lines of:
"There is a distinction between being pro-business and being pro-market. There should be rules in place so that ...
1
vote
2answers
112 views
Free market defense against anti-competitive behavior?
One argument against a completely free market economy without "government" oversight is the tendency towards anti-competitive behavior. The argument is that government laws are needed to prevent anti-...
4
votes
1answer
1k views
Hayek's defense of competition regulation
This article claims Hayek endorsed competition regulation:
As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from ...
2
votes
1answer
116 views
How effective is progressive tax at regulating monopoly?
Regardless of the morality of progressive taxes, the economical benefit of progressive tax is at least debatable. But could a highly progressive tax replace at least some of the american/european anti-...
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vote
1answer
91 views
Should the government regulate the price of bananas? [closed]
Diclaimer: This is not a homework question. Every word of it was written originally by me.
Hypothetical Scenario
Alice is shopping for groceries and thinks the current price of bananas at ...
3
votes
2answers
137 views
How can a free market be operated in a way that significant social and environmental costs are intrinsically covered?
More precisely, is there any practical way to operate a free market so that external costs, namely negative social and environmental impacts, become naturally (intrinsically) covered (paid for or ...
2
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0answers
21 views
Where does the value of implicit government banking guarantees end up?
Post-Lehman a widespread political agenda has established to minimize implicit government guarantees to banks. However, in the buid-up of new banking regulations, lending to small and mid-sized ...
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vote
0answers
34 views
Is anti-competitive behavior a threat in a society with free trade and no regulation?
A question that I have is whether a truly economically free society needs to (or should) have laws against anti-competitive behavior.
Take liquor distribution as an example. In the United States ...
2
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0answers
58 views
What sectors would be most affected positively or negatively by Trump´s trade agreement renegotiations?
One of Trump´s stated policies is that he will renegotiate the trade agreements with China and the Canada and México (NAFTA). This renegotiation might go well in which maybe the US gets freer access ...
2
votes
1answer
141 views
What would be the economic impact of regulating advertising?
What I mean by that putting a regulation on businesses that says they can't spend more on advertising than expanding their business.
I know something like this would be very hard to regulate, but I'...
8
votes
3answers
14k views
Why hasn't massive derivatives exposures at banks already led to disaster?
I recently heard that Deutsche Bank had
$72trillion of "derivatives exposure", which
is many times greater then the entire German GDP.
Now as I understand it, derivatives are essentially
just bets ...
10
votes
1answer
1k views
Wouldn't abolition of cash give rise to a substitute currency?
Some countries (e.g. Sweden and Denmark) plan to abolish physical cash in the future and restrict the use of cash to electronical deposits. One of the reasons for this is to prevent hoarding / boost ...
8
votes
2answers
184 views
Are obstructed views a negative externality?
I recently read an excellent paper on the causes of high urban real estate prices in the United States, Why is Manhattan so expensive? Regulation and the rise in house prices (GLAESER, GYOURKO, and ...
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vote
1answer
75 views
Regulatory differences between stocks and bonds
If you buy stocks of a company you are buying a share in that business.
If you buy bonds from the same company you are essentially loaning them money for future payment.
I am guessing (correct me if ...
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votes
3answers
95 views
Books/Papers on Macroprudential Regulation
I am looking for some good introductory papers or possible books on macroprudential regulation.
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votes
2answers
74 views
References where fewer rules resulted in better governance
I am trying to find references that support an idea that I think I read in a book on theory of institutions. I can't find the original reference. Basically, I'd like to find anything that talks about ...
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1answer
6k views
What does it mean when a bank is “fully loaned up”?
Please briefly explain the situation when a bank is "fully loaned up".
3
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1answer
5k views
Difference between CCAR and ICAAP stress tests
What is the difference between ICAAP and CCAR?
Except that one is for USA and other is for Canada?
3
votes
2answers
638 views
How do we explain the difference in average leverage between banks and non-financial firms?
I've been reading a little about the capital structure of banks. For example, in this working paper, "Financing as a Supply Chain: The Capital Structure of Banks and Borrowers" by Gornall ...
9
votes
1answer
206 views
Banking Regulatory Frameworks, between the 1973 collapse of Bretton Woods and the introduction of the Basel Accords in 1988?
Does anyone know of any work on banking system behaviour, and in particular the governing regulatory frameworks that applied between the 1973 collapse of the gold standard based Bretton Woods system ...
2
votes
2answers
294 views
Is there a theory of financial regulation?
I wonder whether there exists (even a young) theory of financial regulation in the sense of "how to regulate a financial institution/system in an optimal manner"? I mean, there is experience about ...
