The Grain Futures Act of 1922 and the Dominance of the CBOT

Rasheed Saleuddin

Chapter Chapter 3 in The Government of Markets, 2018, pp 87-148 from Palgrave Macmillan

Abstract: Abstract Congress passed the Grain Futures Act in 1922 soon after the Crisis of 1921, when wheat prices fell more than half. Contrary to the accepted view that the regulation was a failed attempt to control the markets, the legislation was almost fully ‘captured’ by the Chicago Board of Trade (CBOT). The Chicago futures markets benefited substantially from the legislation, gaining legitimacy in the Courts and in Congress, while cementing a protected monopoly that would not be broken until late in the twentieth century. On the other hand, the US government gained the right to obtain hitherto unavailable information about the markets, publish such data and perform in-depth analysis for use by the regulators, Congress and the futures market participants, themselves.

Keywords: Grain Futures Act; Market regulation; Capture; Public interest (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:pal:psitcp:978-3-319-93184-5_3

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DOI: 10.1007/978-3-319-93184-5_3

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