Constituencies and Legislation: The Fight Over the McFadden Act of 1927

Raghuram Rajan and Rodney Ramcharan ()
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Rodney Ramcharan: University of Southern California, Los Angeles, California 90089

Management Science, 2016, vol. 62, issue 7, 1843-1859

Abstract: The McFadden Act of 1927 was one of the most hotly contested pieces of legislation in U.S. banking history, and its influence was felt over half a century later. This paper studies the congressional voting behavior surrounding the act’s passage. We find that congressmen in districts in which landholdings were concentrated and credit was costlier were significantly more likely to oppose the act. The evidence suggests that whereas the law and the overall regulatory structure can shape the financial system far into the future, they themselves are likely to be shaped by elites, even in countries with benign political institutions. This paper was accepted by Amit Seru, finance .

Keywords: financial institutions: banks; finance; government: regulations (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (5)

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http://dx.doi.org/10.1287/mnsc.2015.2214 (application/pdf)

Related works:
Working Paper: Constituencies and legislation: the fight over the McFadden Act of 1927 (2012)
Working Paper: Constituencies and Legislation: The Fight over the McFadden Act of 1927 (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:62:y:2016:i:7:p:1843-1859

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