States, Scandals and Financial Markets

The chief purpose of this book has been to describe and to understand puzzling developments in the regulation of the most important financial markets of advanced capitalism. The most striking of these developments can be grouped under four linked headings: the growing similarity of practices and of institutions in financial centres that once had highly distinctive regulatory regimes; the central part played by state agencies in the process of change; the way all this has altered the bias to mesocorporatism in financial services; and the increasing ‘Americanisation’ of regulation. There is immense pressure to equalise regulatory standards, whether these standards concern the capital adequacy of banks or the rules governing insider trading. This pressure for rule uniformity has in turn helped create greater uniformity in the organisation of regulatory institutions. In some cases — like the adoption of American style ‘Chinese Walls’ in firms — the diffusion of structures is limited. In other cases — notably Britain’s reconstruction of regulation in the Financial Services Act — the shift towards an American pattern is dramatic.