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Self-regulation as a remedy for market turmoil: An over-the-counter or a prescription drug?

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  • Senderski, Marcin

Abstract

The paper tackles the problem of the overwhelming regulatory burden that marks its presence in a post-crisis environment. With evidence of regulatory overload in some cases, paths for more effective design of regulatory frameworks should be sought. Although self-regulation does not enjoy favorable publicity and happens to fail to prove its value in times of distress, it still may serve as a remedy. A number of studies shows that, under specific circumstances, the self-regulatory framework may operate seamlessly for the benefit of all stakeholders. The goal of this paper is to identify these circumstances and validate them on the basis of three concise case studies from the health care, advertising and financial services industry. It is instructive for policy makers in deciding on whether to abandon or reduce public oversight in certain areas, by allowing businesses more freedom in terms of setting and enforcing the rules.

Suggested Citation

  • Senderski, Marcin, 2012. "Self-regulation as a remedy for market turmoil: An over-the-counter or a prescription drug?," MPRA Paper 51328, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:51328
    as

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    File URL: https://mpra.ub.uni-muenchen.de/51328/1/MPRA_paper_51328.pdf
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    References listed on IDEAS

    as
    1. Lazzarini, Sergio G. & Carvalho de Mello, Pedro, 2001. "Governmental versus self-regulation of derivative markets: examining the U.S. and Brazilian experience," Journal of Economics and Business, Elsevier, vol. 53(2-3), pages 185-207.
    2. Marianne Ojo, 2011. "Co‐operative and competitive enforced self regulation," Journal of Financial Regulation and Compliance, Emerald Group Publishing Limited, vol. 19(2), pages 139-155, May.
    3. Paul L. Joskow, 2010. "Market Imperfections versus Regulatory Imperfections," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(03), pages 3-7, October.
    4. Alex Cukierman, 2011. "Reflections on the Crisis and on its Lessons for Regulatory Reforms and for Central Bank Policies," Chapters, in: Sylvester Eijffinger & Donato Masciandaro (ed.), Handbook of Central Banking, Financial Regulation and Supervision, chapter 3, Edward Elgar Publishing.
    5. repec:ces:ifodic:v:8:y:2010:i:3:p:14566927 is not listed on IDEAS
    6. Paul L. Joskow, 2010. "Market Imperfections versus Regulatory Imperfections," ifo DICE Report, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 8(3), pages 3-7, October.
    7. Currie, Carolyn, 2006. "A new theory of financial regulation: Predicting, measuring and preventing financial crises," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 35(1), pages 48-71, February.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    self-regulation; self-regulatory organization; regulatory agencies; financial crisis; financial services industry; health care industry; advertising industry;
    All these keywords.

    JEL classification:

    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law
    • M38 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Government Policy and Regulation

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