Regulatory capture and banking supervision reform

Pierre Boyer and Jorge Ponce

Journal of Financial Stability, 2012, vol. 8, issue 3, 206-217

Abstract: We analyze whether banking supervision responsibilities should be concentrated in the hands of a single supervisor. We find that splitting supervisory powers among different supervisors is a superior arrangement in terms of social welfare to concentrating them in a single supervisor when the capture of supervisors by bankers is a concern. This result has implications for the design of banking supervisory architecture and informs current reform efforts in this field.

Keywords: Prudential supervision; Regulatory capture; Banking supervision reform; Financial supervision architecture (search for similar items in EconPapers)
JEL-codes: D42 G24 (search for similar items in EconPapers)
Date: 2012
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Citations: View citations in EconPapers (51)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finsta:v:8:y:2012:i:3:p:206-217

DOI: 10.1016/j.jfs.2011.07.002

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