| 来源类型 | Discussion paper
|
| 规范类型 | 论文
|
| 来源ID | DP8164
|
| DP8164 Theory and the Market after the Crisis: the Endogeneity of Financial Governance |
| Geoffrey Underhill
|
| 发表日期 | 2010-12-01
|
| 出版年 | 2010
|
| 语种 | 英语
|
| 摘要 | The inheritance of contemporary financial economics invites us to consider financial stability as integral to a liberal market setting. The crisis however demonstrated that financial markets may prove highly dysfunctional in the absence of adequate mechanisms of regulation and governance. This implies that economic theory requires an enhanced understanding of the intersection of economic rationality with the rationality of governance. This article extends the insights of institutional economics to demonstrate that the emergence of the institutions of financial governance is endogenous to the utility-maximising behaviour of competing economic agents. Utility-maximising behaviour and conflict over the terms of competition in the market generate both the formal and informal institutions and processes of governance such as regulation and dispute settlement. The model is illustrated by the case of international finance, predicting forms of policy rent seeking in a market environment: private interests embedded in public policy processes simultaneously reshaped both market and governance in line with their own perceived utility functions. The model predicts that similar policy rent seeking will dominate the reform process. Successful reform will require a conceptual understanding of this link between governance and market competition, and appropriate changes in the nature of the policy process so as to reshape markets to avoid financial instability in the future. |
| 主题 | Financial Economics
|
| 关键词 | Transaction costs
Endogeneity
Financial governance
Policy rent seeking
|
| URL | https://cepr.org/publications/dp8164
|
| 来源智库 | Centre for Economic Policy Research (United Kingdom)
|
| 资源类型 | 智库出版物
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| 条目标识符 | http://119.78.100.153/handle/2XGU8XDN/537001
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推荐引用方式
GB/T 7714 |
Geoffrey Underhill. DP8164 Theory and the Market after the Crisis: the Endogeneity of Financial Governance. 2010.
|
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