- 1815-1973 (online)
Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.
The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.
Prudential Regulation and Competition in Financial Markets
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- Rudiger Ahrend1, Jens Arnold1, Fabrice Murtin1
- Author Affiliations
- 1: OECD, France
- 01 Dec 2009
- Bibliographic information
This paper examines how a range of stability-oriented regulatory policies for banking and insurance are related to selected stability and competition outcomes in these sectors. Based on survey information on financial market regulation, policy indicators for eight areas of prudential banking regulation are constructed, in addition to indicators for the insurance sector. Despite incomplete information on some areas that turned out to be important in the context of the recent financial crisis, the indicators correlate well with different measures of financial stability, both during the recent crisis and beyond. Furthermore, the results do not support the view that there is a general trade-off between stability-oriented regulatory policies and competition in banking and insurance.
- stability, insurance, banking, prudential regulation, competition
- JEL Classification:
- E44: Macroeconomics and Monetary Economics / Money and Interest Rates / Financial Markets and the Macroeconomy
- G01: Financial Economics / General / Financial Crises
- G14: Financial Economics / General Financial Markets / Information and Market Efficiency ; Event Studies ; Insider Trading
- G21: Financial Economics / Financial Institutions and Services / Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages
- G22: Financial Economics / Financial Institutions and Services / Insurance ; Insurance Companies ; Actuarial Studies
- G28: Financial Economics / Financial Institutions and Services / Government Policy and Regulation
- L11: Industrial Organization / Market Structure, Firm Strategy, and Market Performance / Production, Pricing, and Market Structure ; Size Distribution of Firms