Seeing like the BIS on Capital Rules: Institutionalising Self-regulation in Global Finance

Kevin Ozgercin

New Political Economy, 2012, vol. 17, issue 1, 97-116

Abstract: How does the Bank for International Settlements (BIS) ‘see’ global financial supervision? This article finds that the BIS's approach to bank supervision relies on private banks to be self-regulating entities and favours the interests of the largest global banks and financial centres. The BIS's private, club-like design and culture insulate private-sector participation in global financial policy-making from governmental control and oversight, blur the line between the public and private spheres of policy-making and allow private norms to shape public norms in global financial governance. Moreover, the BIS's normative framework concerning financial-market governance, in general, and bank supervision, in particular, is shaped by the bank's long-standing belief that state intervention into financial markets in the form of regulations and controls produces suboptimal economic outcomes. Rather than resulting from external factors such as great power dominance, regulatory capture or the search for ‘best practices’, the BIS's bias towards the policy preferences and market interests of the largest banks and financial centres is explained through a detailed examination of its institutional design and history as a bank founded by and for the world's largest banks – central as well as private.

Date: 2012
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DOI: 10.1080/13563467.2011.569020

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