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Regulatory capture and banking supervision reform

Listed author(s):
  • Boyer, Pierre C.
  • Ponce, Jorge

We analyze whether banking supervision responsibilities should be concentrated in the hands of a single supervisor. We find that splitting supervisory powers among different supervisors is a superior arrangement in terms of social welfare to concentrating them in a single supervisor when the capture of supervisors by bankers is a concern. This result has implications for the design of banking supervisory architecture and informs current reform efforts in this field.

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File URL: http://www.sciencedirect.com/science/article/pii/S1572308911000416
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Article provided by Elsevier in its journal Journal of Financial Stability.

Volume (Year): 8 (2012)
Issue (Month): 3 ()
Pages: 206-217

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Handle: RePEc:eee:finsta:v:8:y:2012:i:3:p:206-217
DOI: 10.1016/j.jfs.2011.07.002
Contact details of provider: Web page: http://www.elsevier.com/locate/jfstabil

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