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TOO MUCH REGULATION?
Author(s) -
Wood Geoffrey E.
Publication year - 2003
Publication title -
economic affairs
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.24
H-Index - 18
eISSN - 1468-0270
pISSN - 0265-0665
DOI - 10.1111/1468-0270.00426
Subject(s) - financial regulation , government regulation , environmental regulation , market regulation , business , economics , risk analysis (engineering) , public economics , political science , market economy , finance , law , china
This paper considers the purposes that regulation and supervision of financial institutions are designed to serve. Historical experience with regulation and supervision is considered, and it is argued on the basis of that examination that a fairly ‘light touch’ in regulation is likely to achieve the objectives that governments and citizens require regulation to achieve. Accordingly, the paper concludes that when regulation is evaluated and compared with unregulated systems, one should be careful to compare fallible regulation with fallible markets, rather than implicitly assuming regulation is perfect. Otherwise over‐regulation will result.