International Financial Regulation: The Role of Banking Sector Sizes

Johannes Matschke

No RWP 21-13, Research Working Paper from Federal Reserve Bank of Kansas City

Abstract: Several countries do not or only partially follow basic international regulatory guidelines. Though these countries are small, they aggregate to a nontrivial portion of the global financial market. This paper studies the incentives of regulators to coordinate their efforts and shows that countries with a small banking sector may oppose any financial regulation, even as larger countries commit to stricter rules. As a result, it may be infeasible to design regulatory minimum standards that are enforced by all jurisdictions, which explains key issues around the implementation of the Basel Agreements.

Keywords: International liquidity regulation; Free-riding; Banking sector (search for similar items in EconPapers)
JEL-codes: D62 F36 F42 G15 G21 (search for similar items in EconPapers)
Pages: 73
Date: 2021-11-17, Revised 2026-05-14
New Economics Papers: this item is included in nep-fdg
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedkrw:93597

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DOI: 10.18651/RWP2021-13

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