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Curbing Consumer Financial Losses: The Economics of Regulatory Enforcement
Author(s) -
FAURE MICHAEL,
OGUS ANTHONY,
PHILIPSEN NIELS
Publication year - 2009
Publication title -
law and policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.534
H-Index - 45
eISSN - 1467-9930
pISSN - 0265-8240
DOI - 10.1111/j.1467-9930.2009.00299.x
Subject(s) - sanctions , enforcement , discretion , legislation , business , key (lock) , public economics , compliance (psychology) , law enforcement , law and economics , finance , economics , computer security , political science , law , computer science , psychology , social psychology
This article deals with the question of how a high level of compliance with consumer protection legislation designed to prevent financial losses can be secured. We use a theoretical framework based on economic analysis of law to address some of the key policy options, such as proactive and reactive monitoring, providing officials with postdetection enforcement discretion, administrative, civil, and criminal sanctions, and facilitating actions by victims and third parties. On the basis of our theoretical framework and a classification of jurisdictions into different groups (models of enforcement policy), we identify some key elements of an enforcement regime and indicate in what circumstances a particular solution can be expected to be more or less cost effective.