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on Regulation |
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Issue of 2006‒06‒03
nineteen papers chosen by Christian Calmes Universite du Quebec en Outaouais, Canada |
| By: | Maria Concetta Chiuri (Dipartimento di Scienze Economiche - Università di Bari); Giovanni Ferri (Dipartimento di Scienze Economiche - Università di Bari); Giovanni Majnoni (World Bank) |
| Abstract: | We test for emerging economies the hypothesis - previously verified for G-10 countries only - that the enforcement of bank capital asset requirements (CARs) exerts a detrimental effect on the supply of credit. The econometric analysis on individual bank data suggests three main results. First, CAR enforcement - according to the 1988 Basel standard - significantly curtailed credit supply, particularly at less-well capitalized banks. Second, such negative impact was larger for countries enforcing CARs in the aftermath of a currency/financial crisis. Third, the adverse impact of CARs on the credit supply was significantly smaller for foreign-owned banks, suggesting that opening up to foreign investors may be an effective way to partly shield the domestic banking sector from negative shocks. Overall, CAR enforcement - by inducing banks to reduce their lending - may well have induced an aggregate credit slowdown or contraction in the examined emerging countries. This paper is relevant to the ongoing debate on the impact of the revision of bank CARs, as contemplated by the 1999 Basel proposal. Our results suggest that in several emerging economies the revision of bank CARs could well induce a credit supply retrenchment, which should not be underestimated. |
| Keywords: | bank capital asset requirements, capital crunch |
| JEL: | G18 G21 G28 |
| URL: | http://d.repec.org/n?u=RePEc:bai:series:wp0002&r=reg |
| By: | Cécile Carpentier; Jean-Marc Suret |
| Abstract: | Acknowledging that securities regulation penalizes small growing firms in their attempt to raise equity capital, most of the Canadian provinces have recently reformed their exemption rules. These rules allow the issuance of securities outside the boundaries of securities regulation. The rules governing the resale of securities issued within the exemption system have been eased considerably. In part because this task is fairly complex, securities regulations are not yet harmonized across the provinces. The first objective of this paper is to present to non-specialists of securities regulation the broad outlines and the challenges of this liberalization. Non-conventional financing, such as accessing the stock market via capital pool companies or private placements in public equities, along with reverse takeovers, are becoming more common than non-exempted issues. This trend in business financing, together with the growing liberalization, is taking shape in a context of reinforcement of regulation and control of disclosure and governance for public companies that follow financial scandals. The co-occurrence of these events raises important questions that have received little attention to date, and implies serious risks that remain unexplored. Analysis of these risks is the second objective of this study. In particular, we assess the risks inherent in the decrease in market liquidity and in market quality. As some American works assert that private equity development may engender significant risks for investors, public policy makers should put in place efficient mechanisms to monitor these transactions and issuers in the new regulatory context. <P>Acceptant l’argument qui veut que la réglementation des valeurs mobilières puisse pénaliser le financement des entreprises de petite taille en croissance, la plupart des provinces canadiennes ont modifié récemment leur réglementation des régimes de dispenses. Ceux-ci permettent l’émission de titres en dehors du cadre standard de la réglementation des valeurs mobilières. Les règles qui régissent la revente des titres émis par voie de dispense ont également été fortement assouplies. Il s’agit de sujets complexes, d’autant que les réglementations ne sont pas encore harmonisées. Le premier objectif de ce texte est de présenter, à des non spécialistes du droit des valeurs mobilières, les grandes lignes et les enjeux de cette libéralisation. Les opérations de financement non conventionnelles, telles que l’entrée en Bourse par l’intermédiaire de sociétés de capital de démarrage, les placements privés par des sociétés ouvertes, et les prises de contrôle inversées sont devenues plus fréquentes que celles régies par les dispositions fondamentales de la réglementation des valeurs mobilières. Les modifications de comportement des entreprises et la libéralisation des règles surviennent par ailleurs au moment où les exigences et les contrôles en termes de gouvernance et d’information sont renforcés pour les sociétés ouvertes, à la suite des scandales boursiers. La coïncidence de ces divers facteurs soulève d’importantes questions qui ne semblent pas avoir été étudiées, et comporte des risques sérieux qui n’ont pas été évalués. Leur analyse est le second objectif de cette étude. Nous évoquons notamment les risques liés à la réduction de la liquidité du marché et de la qualité du marché. Il semble également, sur la base des travaux américains, que le développement du placement privé puisse faire courir des risques importants aux investisseurs. Les autorités devraient donc mettre en place des mécanismes efficaces d’observation des transactions et de l’évolution des entreprises dans le cadre de ces nouvelles réglementations. |
| Keywords: | private placement, securities regulation, financing, placement privé, réglementation des valeurs mobilières, financement |
| Date: | 2004–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2004s-51&r=reg |
| By: | Pierre Lefebvre; Philip Merrigan |
| Abstract: | On September 1st, 1997, a new childcare policy was initiated by the provincial government of Québec in Canada. Childcare services licensed by the Ministry of the Family (not-for-profit centre, family-based, and for-profit centre under the agreement) began offering daycare spaces at the reduced parental contribution of $5 per day per child for children of age 4. For each following year, the government reduced the age requirement and engaged in a plan to create new childcare facilities and pay for the cost of additional $5 per day daycare spaces. On September 2000, the low-fee policy applied to all children aged 0-59 months (not in kindergarten) and the number of subsidized places increased from 82,000 in 1997 to 163,000 by the end of year 2002, while the number of eligible children, zero to four years old, declined from 445,000 to 373,000 over the same period. Using annual data (1993 to 2002), drawn from Statistics Canada’s Survey on Labour and Income Dynamics (SLID), this study attempts to estimate the effect of the policy on the labour supply behaviour of Québec mothers with pre-school children, aged from 0 to 5 years old. The analysis examines the impact of the policy on the following outcomes: labour force participation, number of annual weeks and hours worked, annual earned income and whether the job was full-time or part-time for mothers who declared having a job during the reference year. A non-experimental evaluation framework based on multiple pre- and post-treatment periods is used to estimate the effect of the childcare regime.<P> The econometric results support the hypothesis that the childcare policy, simultaneously with the transformation of public kindergarten from a part-time to a full-time basis, had a large and statistically significant impact on the labour supply of Québec’s mothers with pre-school children. The estimates also suggest, though less convincingly, that the size of the impact increased simultaneously with the positive growth in the number of low-fee spaces. <P>Le 1er septembre 1997, le gouvernement du Québec instaurait une nouvelle politique de subventions aux services de garde. Les milieux de garde reconnus par le ministère de la Famille et de l’Enfance ont commencé à offrir des places à contribution réduite (5 $/jour) pour les enfants qui avaient atteint l'âge de 4 ans au 30 septembre. En outre, le gouvernement s’engageait à réduire progressivement (chaque année) l’âge d’admissibilité à ces places et à augmenter leur nombre dans le réseau des services de garde subventionnés. Malgré l’ampleur des dépenses publiques pour ce programme, il n’y a pas d’étude qui a porté sur la réalisation des objectifs poursuivis par cette politique. Cette étude vise à combler en partie cette lacune en analysant les effets de la politique de garde sur l’offre de travail des mères québécoises. Elle s’appuie sur les données annuelles recueillies de 1993 à 2002 par l’Enquête sur la dynamique du travail et des revenus (EDTR) de Statistique Canada. L’évaluation des effets de la politique de garde sur différents indicateurs du marché du travail (taux d’occupation d’un emploi, semaines et heures annuelles travaillées, revenu annuel de travail, participation à temps plein au marché du travail) adopte une approche « quasi expérimentale », c’est-à-dire que les différences entre les mères québécoises (groupe traitement) et les mères des autres provinces (groupe de contrôle) sont comparées avant et après la mise en place du régime de subventions aux services de garde. Nos résultats sont conformes à l’hypothèse selon laquelle le programme de soutien aux services de garde mis en place par le gouvernement du Québec, en même temps que la maternelle cinq ans gratuite et à temps plein, ont eu un impact important et statistiquement significatif sur l’offre de travail des mères ayant des enfants de 5 ans ou moins. Les résultats économétriques soutiennent aussi, quoique de façon moins convaincante, que l’ampleur de l’effet a augmenté parallèlement à l’augmentation du nombre de places à contribution réduite de 1998 à 2002. En effet, nous ne pouvons rejeter l’hypothèse selon laquelle l’effet de la politique est le même pour les années 1999 à 2002. Cependant, la régularité de la progression de cet effet pour toutes les variables d’offre de travail laisse croire que l’augmentation du nombre de places a eu un rôle important à jouer dans l’augmentation de l’offre de travail. |
| Keywords: | labor supply of mothers, childcare policy, panel data, offre de travail des mères, politique des services de garde, données de panel |
| JEL: | H42 J21 J22 |
| Date: | 2005–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2005s-09&r=reg |
| By: | Thierry Pairault (CECMC - Centre d'études sur la Chine moderne et contemporaine - [CNRS : UMR8561] - [Ecole des Hautes Etudes en Sciences Sociales]) |
| Abstract: | La question des droits patrimoniaux relatifs à la propriété et du droit de propriété en Chine dans le contexte de la réforme du secteur d'État est l'objet de cette étude. Afin d'assumer l'héritage du système d'appropriation, les dirigeants chinois ont été régulièrement confrontés à la nécessité de clarifier ces droits patrimoniaux. Une telle clarification est particulièrement cruciale pour les entreprises d'État dont le statut est étroitement lié à la légitimité d'un « socialisme à la chinoise ». Aux termes de la onstitution, « l'État maintient la propriété publique comme élément principal dans un système économique où plusieurs modes d'appropriation se développent ensemble ». Une telle diversité d'intérêts divergents suppose une mutation des droits patrimoniaux et des obligations du secteur d'État. La restructuration des entreprises d'État doit-elle être interprétée comme leur privatisation ? Dans quelle mesure la clarification des droits patrimoniaux conduit-elle inévitablement à une redistribution du droit de propriété ? |
| Keywords: | Chine;droit de propriété;droits patrimoniaux;entreprises d'État |
| Date: | 2006–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:papers:halshs-00076579_v1&r=reg |
| By: | Australian Prudential Regulation Authority (Australian Prudential Regulation Authority) |
| Date: | 2005–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:apr:aprpdp:dp0015&r=reg |
| By: | Australian Prudential Regulation Authority (Australian Prudential Regulation Authority) |
| Date: | 2005–05–06 |
| URL: | http://d.repec.org/n?u=RePEc:apr:aprpdp:dp0017&r=reg |
| By: | C. Robert Clark; Andrew Leach |
| Abstract: | <P>Ce rapport aborde la question de la réglementation des marchés de l’énergie en général en mettant l’accent sur les marchés de l’électricité et du gaz naturel. On réglemente des marchés si l’on juge qu’ils représentent des situations de monopole naturel ou si l’on a des raisons de croire que les firmes non réglementées ne tiendraient pas compte des externalités qu’elles pourraient créer. L’argument habituellement invoqué pour justifier la réglementation des marchés de l’énergie est que celle-ci représente la meilleure solution de rechange lorsque le marché est défaillant. En d’autres termes, le résultat obtenu avec la réglementation peut s’avérer meilleur que celui que l’on obtiendrait si le marché n’était pas réglementé. Dans ce cas, l’intervention du gouvernement peut être requise pour protéger les intérêts des consommateurs. <P> Les marchés de l’énergie ont généralement été perçus comme des situations de monopole naturel, dans une large mesure en raison des énormes coûts fixes associés à la production et à la distribution de l’énergie. De plus, l’électricité et le gaz naturel sont généralement considérés comme des biens essentiels, ou plus précisément, comme des biens pouvant générer des bénéfices externes considérables lorsque fournis de manière fiable. Un approvisionnement fiable est nécessaire au bon fonctionnement de toute économie moderne et un marché privé pourrait ne pas fournir de manière égale le service aux consommateurs de différentes régions. <P> Au cours des dernières années, des segments de certains marchés de l’énergie ont été libéralisés n’étant plus perçus comme constituant des situations (actuelles ou potentielles) de monopole naturel ou parce que le marché permettait de s’assurer que les firmes prennent en considération les externalités qu’elles génèrent. Nous présentons ici les expériences de certaines juridictions en matière de libéralisation des marchés de l’énergie et montrons que la réglementation est possible et qu’elle est même susceptible d’apporter une amélioration par rapport au statu quo, dans la mesure où elle limite la position dominante d’une firme sur le marché. <P> Nous considérons ensuite le potentiel de restructuration des marchés de l’énergie au Québec, lesquels sont présentement réglementés principalement par la Régie de l’énergie du Québec. Le marché québécois de l’électricité ne constitue pas un cas typique pour la restructuration du secteur de la production puisqu’une grande majorité de la capacité génératrice provient de centrales hydroélectriques. En effet, plus de 90 % de la capacité électrique installée au Québec provient de sites hydrauliques, ce qui place la province au second rang des marchés hydroélectriques au monde, après la Norvège. Qui plus est, cette capacité est hautement concentrée sur trois réseaux hydrographiques. Le modèle usuel de cession forcée par réseau fluvial est susceptible d’introduire un pouvoir de marché au sein du marché restructuré et risque de créer de plus grandes inefficacités que celles prévalant sous le régime réglementé. Pour que la restructuration s’avère un succès, au moins une des deux approches suivantes doit être retenue. D’une part, un système avec droits de débit échangeables pourrait être mis en place parallèlement à un marché d’énergie concurrentiel, de façon à permettre la cession d’installations individuelles à l’intérieur d’un réseau fluvial ou, d’autre part, les marchés du Québec pourraient être ouverts à la concurrence étrangère. <P> Le segment de la vente au détail des marchés québécois de l’électricité et du gaz naturel pourrait potentiellement bénéficier de la libéralisation. La seule différence évidente entre les marchés de l’énergie du Québec et ceux d’autres juridictions provient de la politique de tarification uniforme. De plus bas prix pourraient prévaloir si le marché était ouvert à la concurrence, mais pas pour tous les consommateurs. La détermination du Québec à maintenir une tarification uniforme pour toute la province signifie que certains consommateurs paient actuellement leur énergie en deçà du prix du marché. Le prix pour ces consommateurs pourrait être appelé à augmenter si la restructuration du marché devait avoir lieu. |
| Date: | 2005–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirbur:2005rb-04&r=reg |
| By: | Wolfgang Kerber (Philipps-Universität Marburg) |
| Abstract: | Since the 1990s, an intensive discussion on the necessity and the potential design of international competition policy has developed. As a preliminary result, some general tendencies can be observed: Many states (including the U.S. and the EU) and most antitrust experts hold the opinion that the traditional system of national competition laws (including their extra-territorial application) is not sufficient for the protection of competition in the new millennium. Therefore, some kind of international arrangement in regard to competition rules seems to be necessary. The introduction of substantive international competition rules with an international competition authority and a corresponding court (in analogy to the supranational European competition law) is not seen as feasible and/or desirable. Thus the solution should not be sought in centralised global competition rules but be based primarily upon national competition laws and authorities. Consequently, the main thrust of the discussion has shifted from the idea of a larger harmonisation and convergence of national competition laws to the problem of better international enforcement of these laws. Although bilateral cooperation between national competition authorities have become an increasingly important issue, bilateral cooperation agreements are considered only a first step to a more preferable multilateral (or plurilateral) solution (e.g. within the WTO). Generally, the path to international competition rules is seen as a pragmatic, step-by-step approach, which can achieve its aim only in the long run. The currently favoured informal network approach, which remains without commitment and emphasizes primarily the gathering, discussion and exchange of information between national competition authorities, is in line with such a pragmatic approach to the incremental evolution of international competition rules. How can we describe the present situation from a global perspective? We have a multitude of national competition laws and enforcement agencies (competition authorities, courts) with more or less different substantive and procedural rules. Different competition laws and enforcement agencies can also exist within a (kind of) federal system, as to some degree within the U.S. and to a larger extent within the EU, where European competition rules and national competition laws coexist on two different levels. Since the competencies of these competition laws and enforcement agencies overlap, many external effects and conflicts can emerge. Up to now we cannot reasonably argue that this complex structure of competition laws forms an integrated system for protecting competition in international markets. The establishment of international competition rules (as well as the less ambitious international network approach), which on one side should help to solve the problems of the current situation, can, on the other side, increase the complexity of the system, because an additional vertical regulatory level in regard to competition rules would be introduced – including new potential conflicts of competencies. But what are the long-term perspectives of this situation? What can an international system for protecting competition look like in the long run? Two basic perspectives can be outlined: One perspective is that such a pragmatic approach, which fosters the discussion between different countries and their competition authorities, eventually will lead to a uniform global competition law or – at least – to a quasi-harmonisation of national competition laws. If the differences between the competition laws disappeared, many of the current problems would vanish. From this perspective, the current situation with many different competition laws on two or three different levels does constitute only an intermediate phase, which in the long run would be replaced by one quasiuniform set of global competition rules. Another perspective proceeds from the more sceptical assumption that it will not be possible for all countries to agree on one uniform set of competition rules, even in the long run. There will always be different objectives of competition laws and different theories about what competition is and what rules are necessary for the protection of competition. Therefore, the coexistence of different competition laws should be seen as a permanent feature of an international system of competition laws, implying that substantial decentralisation and variety will remain a major characteristic of such an international system, also in the long run. This paper will focus on the second perspective, which can be characterised as an evolutionary one: The objectives of competition policy in different countries might change and remain different; competition theories mightevolve through academic progress; the rules for the protection of competition might have to change due to new anticompetitive business practices or new technology (such as the Internet). From this evolutionary perspective, it is crucial that an international system for the protection of competition should also include the long-term capability of adapting quickly to new competition problems, particularly by fostering legal innovations for improving the protection of competition. One important argument for a more decentralised international system of competition laws will be that decentralisation will increase the capability of the system for innovation and learning in regard to the development of effective legal rules for the protection of competition. But what can a workable international system with different competition laws and enforcement agencies on different levels, i.e., a decentralised international system of competition laws, look like? This paper can only present some considerations about this problem. But its goal is to outline an analytical framework, which can be used for designing a workable multi-level system of competition laws. The main idea is that we should apply economic theories about federalism and the advantages and disadvantages of centralisation and decentralisation to develop arguments about the appropriate institutional structure of an international multi-level system of competition laws. The theories that are used in this paper are the economic theory of federalism, the attempts to apply the concept of federalism to legal rules as well (legal federalism), and the theories of interjurisdictional and regulatory competition. The paper is structured as follows. In section II it is shown that the present situation can be interpreted as being already rather close to a kind of threelevel system of competition laws and that many current issues in European and international competition policy can be interpreted as discussions about problems of the horizontal and vertical delimitation of competencies within such a three-level system. In the main section III an analytical framework concerning the potential advantages and disadvantages of centralisation and decentralisation of competition policy will be developed on the basis of economic theories of federalism and regulatory competition. This will include a (still incomplete) set of criteria for regulatory federalism in competition law. Some conclusions for reconstructing international competition policy as a multi-level system of competition laws are presented in section IV. |
| URL: | http://d.repec.org/n?u=RePEc:bep:dewple:2003-1-1065&r=reg |
| By: | Richard Turkington (Villanova University School of Law) |
| Abstract: | In the article I examine the legality of the not uncommon practice of surreptitiously recording telephone conversations, videotaping activities and accessing e-mail or voicemail communications by parties in domestic disputes. First, I examine the important values that are implicated by such activities. These values include conversation, communication and physical privacy. Conversation (and communication) privacy are valued on both intrinsic and instrumentalist grounds. These values run into countervailing values in domestic conflict cases. These include parental autonomy in child rearing and the best interests of the child. I argue that the pervasiveness of electronic surveillance and the emerging tradition in our legal system to grant "mature minors" self-determination in respect to decisions traditionally left to parents need to count more in accommodating values in parental electronic surveillance cases. Section II examines the legality of electronic surveillance in domestic disputes under federal and state wiretap and stored communications acts and the common law privacy intrusion tort. Wiretap and stored communications acts are notorious for their lack of clarity. I endeavor in part of this section to lay foundations about the basic concepts and structure of these laws and identify areas where there is some clarity. Wiretap acts generally prohibit surreptitious electronic surveillance of conversations. However, electronic surveillance in domestic disputes may be legal if the surveillance is sanctioned under three exceptions. These are: (1) the marital conflict exception; (2) the telephone extension exception; and (3) the vicarious consent exception. I join other commentators in their criticism of the first two exceptions. The vicarious consent exception is of recent vintage and I argue that the exception ought to be junked for several reasons. These include inherent problems with the parental motive tests, the incomprehensibility of vicarious consent with the modern law of joint custody, and the non-identity of interests in parental electronic surveillance cases. I also suggest that the problems with the self-minimization role granted to parents under the vicarious consent exception is another reason to junk the defense. Access to e-mail and voicemail are regulated under federal and state stored communications acts. Unlike wiretap acts these statutes do not contain exclusionary rules and the fruits of violations of stored communications acts are still admissible in civil and criminal proceedings. Courts have construed stored communication acts to not apply to surreptitious access of e-mail and voicemail from computers in the home. In addition, silent video surveillance is not regulated under wiretap or stored communications acts. This development has elevated the role of the common law privacy intrusion tort in legal evaluation of access to e-mail in home computers and surreptitious video surveillance in the home. It is clear that surreptitious audio and video surveillance in domestic conflicts may constitute tortuous conduct even if the conduct does not violate wiretap or stored communications acts. I examine the extent to which parties may have reasonable expectations of privacy in conversations and communications within the meaning of the privacy intrusion tort. I conclude that it would be tortuous conduct for a spouse to access e-mail stored in a home computer if the e-mail is stored in a segregated account and the parties have maintained separate passwords. Much evidence that is obtained by illegal electronic surveillance maybe admissible in marriage and custody proceedings because violations of stored communications acts and the privacy intrusion tort do not provide a basis for excluding evidence in civil court proceedings. I suggest that protective orders based upon discovery rules and constitutional privacy rights may provide a way to protect privacy by excluding some communications or images from admissibility in judicial records. |
| URL: | http://d.repec.org/n?u=RePEc:bep:villwp:villanovalwps-1010&r=reg |
| By: | Susan Rose-Ackerman (Yale Law School) |
| Abstract: | Trust implies confidence, but not certainty, that some person or institution will behave in an expected way. A trusting person decides to act in spite of uncertainty about the future and doubts about the reliability of others' promises. The need for trust arises from human freedom. As Piotr Sztompka (1999: 22) writes, "facing other people we often remain in the condition of uncertainty, bafflement, and surprise."Honesty is an important substantive value with a close connection to trust. Honesty implies both truth-telling and responsible behavior that seeks to abide by the rules. One may trust another person to behave honestly, but honesty is not identical to trustworthiness. A person may be honest but incompetent and so not worthy of trust. Nevertheless, interpersonal relationships are facilitated by the belief that the other person has a moral commitment to honesty or has an incentive to tell the truth. Corruption is dishonest behavior that violates the trust placed in a public official. It involves the use of a public position for private gain.I focus on honesty and trust as they affect the functioning of the democratic state and the market. I am interested in informal interactions based on affect-based trust only insofar as they substitute for, conflict with, or complement the institutions of state and market. The relationship between informal connections and formal rules and institutions is my central concern. The institutions of interest are democratic political structures, bureaucracies, law and the courts, and market institutions.As Mark Warren points out, governments are needed in just those situations in which people cannot trust each other voluntarily to take others' interests into account. The state is a way of managing inter-personal conflicts without resorting to civil war. Yet, this task is much more manageable if the citizenry has a degree of interpersonal trust and if the state is organized so that it is trusted by its citizens, at least, along some dimensions. The state may be able to limit its regulatory reach if interpersonal trust vitiates the need for certain kinds of state action (Offe 1999). Conversely, if the state is reliable and even-handed in applying its rules, that is, if people trust it to be fair, state legitimacy is likely to be enhanced (Offe 1999, Sztompka 1999: 135-136). Thus, there are three interrelated issues. First, do trust and reliability help democracy to function, and if so, how can they be produced? Second, do democratic governments help create a society in which trustworthiness and honesty flourish? Third, given the difficulty of producing trustworthiness and honesty, how can institutional reform be used to limit the need for these virtues?This paper provides a framework for thinking about these broad questions. Section I organizes the research on trust especially as it applies to the relationship between trust and government functioning. With this background, section II discusses the mutual interaction between trust and democracy. The alternative of limiting the need for trust leads, in section III, to a discussion of corruption in government and commercial dealings. Corruption occurs when dishonest politicians and public officials help others in return for payoffs. Because their actions are illegal, they need to trust their beneficiaries not to reveal their actions. Corrupt officials are also, of course, betraying the public trust insofar as their superiors are concerned. Reforms here can involve a reorganization of government to limit the scope for lucrative discretionary actions. Conversely, one might focus on changing the attitudes of both officials and private actors so that existing discretion is exercised in a fairer and more impartial manner.This paper analyzes the interactions between trust and democracy at a general level. However, its initial aim was to provide a context for a workshop at the Collegium Budapest on honesty, trust, and corruption in post-socialist countries. My companion paper in Kyklos makes that link explicit by bringing in survey evidence on public attitudes and behavior. Here, I conclude in section IV with some thoughts on the special character of the transition process. I highlight the tensions between interpersonal trust and trust in public institutions in the context of the transition to democracy and a market economy. |
| URL: | http://d.repec.org/n?u=RePEc:bep:yaloln:yale_lepp-1013&r=reg |
| By: | Helge Berger; Stephan Danninger |
| Abstract: | This study explores the effects of labor and product market deregulation on employment growth. Our empirical results, based on an OECD country panel from 1990-2004, suggest that lower levels of product and labor market regulation foster employment growth, including through sizable interaction effects. Based on these findings, the paper develops a theoretical framework for evaluating deregulation strategies in the presence of reform costs. Optimal deregulation takes various forms depending on the deregulation costs and the strength of reform interactions. Compared to the first best, decentralized decision-making based on a partial market-by-market perspective can lead to excessive or insufficient regulation, depending on the design of the decision process. Securing the first best requires not only coordinating deregulation activities across sectors but also overcoming the partial perspective of decision makers. |
| Keywords: | product market regulation, labor market regulation, employment growth, policy coordination, sequencing |
| JEL: | E24 J50 L51 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_1709&r=reg |
| By: | Sophie Lavallée; Kristin Bartenstein |
| Abstract: | Considering both trade globalization and the growing media coverage of the deterioration of natural resources and the ozone layer, the average citizen has become more demanding as a consumer when it comes to the environmental quality of the products he purchases. In this context, the implementation of adequate labeling may become both a major competitive issue in the marketplace as well as a means of promoting sustainable development that will allow the inclusion of environmental considerations in production procedures and in individuals behavior and choices. Designed to inform both private and public consumers of a product’s environmental performance as compared to other products in the same category, the ecolabel is an excellent tool for the implementation of this new development paradigm. The ecolabel is a tool whose goal is to use markets in order to meet environmental goals. Presently, the ecolabel is the result of a “voluntary” step taken by manufacturer who takes it upon himself to declare that his products are ecological through the use of different seals or phrases (“nitrate free”, “ozone layer friendly”, “biodegrable”). Alternatively, the manufacturers may ask an independent organization for the right to use an ecolabel, by following a preset procedure and respecting pre-established criteria. Since the end of the 1980s, many countries have set up ecological certification and ecolabeling programs: the “European ecolabel”, the “Blue Angel” in Germany, the “Green Seal” in the United States, “NF” in France, “Eco-mark” in Japan, and the “Eco-logo” in Canada. For the last ten years, the ecolabel has drawn the interest of public authorities in Western countries. Over this same decade, Europeans have gained a level of expertise that today allows them to assume an international leadership role in the field of ecolabeling. In this context, several European jurists and economists have naturally become interested in the conditions linked to the development of this new tool for regulating production. Their studies show that the creation of a national policy of ecological labeling must be based on recognized standards – private or prescribed – so that the awarding of an ecolabel can be based on objective criteria. In the framework of trade liberalization, the development of the such ecolabel programs must be carried out while, ath the same time, an effort is made to avoid creating obstacles to international trade. Very little study has been devoted to the rules of international law that apply to this subject. This question is, however, central to the sustainable development tool. Our paper sets out to answer this question and to study the impact that the International Standards Organization’s (ISO) 14000 series of standards has had on the harmonization of national ecolabeling policies. Considering the impact of international law standards on the ecolabel’s development as a sustainable tool, it is logical to make an in-depth analysis of the conditions of national ecolabeling policy harmonization at the international level. <P>Destiné à informer le consommateur, privé ou public, sur la performance d’un produit ou d’un service, l’écolabel peut conférer un avantage concurrentiel indéniable à l’entreprise qui cherche à rejoindre une clientèle intéressée par les impacts environnementaux des produits qu’elle consomme. De fait, l’écolabel suscite de plus en plus l’intérêt des grandes entreprises qui le voient progressivement comme un facteur essentiel à prendre en considération dans leurs stratégies industrielles et commerciales. Cet intérêt des entreprises pour la certification écologique volontaire de leurs produits et services revêt une portée encore plus grande dans un contexte de globalisation des marchés puisqu’elle est susceptible d’être « (…) à la fois un mode de protection très efficace des marchés intérieurs et un instrument de conquête de plus en plus incontournable des marchés extérieurs ». Outil commercial véhiculant une information environnementale afin de conférer un avantage concurrentiel aux produits nationaux, l’écolabel pourrait être taxé d’outil du « protectionnisme vert ». Cette possibilité n’a pas encore donné lieu à de réelles contestations mais elle est néanmoins assez sérieuse pour figurer à l’ordre du jour des prochaines études de la Commission du commerce et de l’environnement (CCE) de l’Organisation mondiale du commerce (OMC). Cette commission a d’ailleurs exprimé l’opinion qu’il existe une panoplie de programmes de certifications alimentaires ou environnementales qui reposent sur différents critères et procédures qui sont susceptibles d’avoir des effets sur le commerce. Stigmatisé comme un nouvel obstacle technique au commerce international, l’écolabel pourrait être discrédité et son évolution compromise, malgré les possibilités qu’il représente pour la concrétisation des impératifs du développement durable. Cette éventualité nécessite que nous le soumettions à une analyse au regard des règles de droit du commerce international afin de déterminer s’il est ou non l’outil d’une politique protectionniste. Que la réponse à cette question soit ou non positive, nous verrons, en dernière analyse, que l’harmonisation des différents écolabels s’impose pour assurer l’essor de l’écolabellisation des produits et services. Afin de mener à bien cette réflexion, il convient de répondre aux trois questions suivantes : Qu’est-ce qu’un écolabel? L’écolabel est-il une barrière non tarifaire de protection des marchés intérieurs? Quelles sont les possibilités d’harmonisation internationale des différents écolabels ? |
| Keywords: | ecolabel, environmental labeling, regulation, protectionism, World Trade Organization (WTO), WTO accords, harmonization, International Standards Organization's (ISO) 14000 series, écolabels, étiquetage écologique, régulation, protectionnisme, Organisation Mondiale du Commerce (OMC), harmonisation, série de normes ISO 14020 et 14040 |
| Date: | 2004–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2004s-40&r=reg |
| By: | Romain Duval; Jørgen Elmeskov |
| Abstract: | Structural reforms in labour and product markets are required in a number of euro-area countries. A question in this regard, which is the topic of this paper, is whether belonging to the euro area tends to help or hinder structural reform. The paper first reviews the theoretical arguments and the existing empirical literature – in both cases finding conclusions that point in opposite directions. Next, the paper uses an OECD database on labour market reform developed recently and an update of OECD indicators of product market regulation to compare progress in labour and product market reform over the decade since 1993 between euro-area countries and other OECD countries. Overall, euro-area countries appear to have made relatively good progress in structural reform but it is much less clear from the descriptive evidence whether progress can be ascribed to membership of Economic and Monetary Union. To explore further the role of monetary regime for structural reform, the paper undertakes an econometric examination of the likelihood that countries undertake reform in five specific areas of labour and product market policies. Based on pooled cross-country/time series Probit regressions covering 21 countries and the period 1985-2003, it is found that structural reform is strengthened by high unemployment, crisis as reflected in a large output gap, healthy public finances, reforms in other policy fields and small country size. Further, countries that pursue fixed exchange-rate regimes or participate in monetary union, and therefore have little or no monetary autonomy, appear to undertake less structural reform – with the effect possibly being concentrated on large countries. <P>Les effets de l’UEM sur la mise en œuvre des réformes structurelles sur les marchés du travail et des biens Des réformes structurelles sur les marchés du travail et des biens s’avèrent nécessaires dans un certain nombre de pays de la zone euro. Une question à ce propos, qui constitue le sujet de cet article, est de savoir si l’appartenance à la zone euro tend à favoriser ou à freiner la mise en oeuvre de réformes structurelles. L’article passe tout d’abord en revue les arguments théoriques et la littérature empirique – qui dans les deux cas aboutissent à des conclusions contradictoires. L’article utilise ensuite une base de données OCDE sur les réformes des marchés du travail développée récemment, ainsi qu’une actualisation des indicateurs OCDE de réglementation des marchés des biens, afin de comparer les progrès en matière de réformes des marchés du travail et des biens au cours de la décennie écoulée depuis 1993 entre les pays de la zone euro et les autres pays de l’OCDE. Dans l’ensemble, il apparaît que les pays de la zone euro ont relativement bien progressé en matière de réformes structurelles, mais il est beaucoup moins évident au vu de l’analyse descriptive que ces progrès peuvent être attribués à l’appartenance à l’Union Économique et Monétaire. Afin d’explorer plus avant le rôle du régime monétaire dans la mise en œuvre de réformes structurelles, l’article effectue une analyse économétrique de la probabilité que les pays entreprennent des réformes dans cinq types de politiques relatives aux marchés du travail et des biens. Sur la base de régressions de type Probit sur données de panel couvrant 21 pays au cours de la période 1985-2003, il ressort que la mise en œuvre de réformes structurelles est renforcée par un chômage élevé, une crise économique telle que mesurée par un écart de production élevé, une situation saine des finances publiques, l’existence de réformes dans d’autres domaines et la faible taille du pays considéré. En outre, les pays participant à un régime de changes fixes ou à une union monétaire, et qui par conséquent disposent d’une autonomie limitée voire inexistante de leur politique monétaire, apparaissent entreprendre moins de réformes structurelles – cet effet étant potentiellement plus marqué dans le cas des grands pays. |
| Keywords: | labour markets, marché du travail, euro, Euro, Economic and Monetary Union, Union économique et monétaire, product markets, political economy, économie politique, reforms, marchés des biens, réformes |
| JEL: | D7 O52 |
| Date: | 2005–07–25 |
| URL: | http://d.repec.org/n?u=RePEc:oec:ecoaaa:438-en&r=reg |
| By: | Joakim Johansson (Inregia AB); Sirje Pädam (Departament of Public Economy at Tallinn University of Technology, and Inregia AB) |
| Abstract: | From the perspective of economic efficiency there are obvious advantages of regional differentiation of regulatory measures instead of relying on nationally uniform regulation, which is due to the fact that adverse health impacts, as well as other negative externalities, such as environmental damage and congestion, vary between locations. One conclusion of the analysis is that ranking of economic instruments depends on whether regulation is imposed nationally or regionally. Another implication is that if road pricing is not possible to implement locally, then command and control need to be considered. |
| Keywords: | air quality standards, road pricing, vehicle taxes, scrapping subsidy, economic efficiency |
| JEL: | D62 R48 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:ttu:wpaper:121&r=reg |
| By: | Stephen L. Ross (University of Connecticut); George C. Galster (Wayne State University) |
| Abstract: | Using paired testing data from the 1989 and 2000 Housing Discrimination Studies (HDS) and data on fair housing enforcement activities during the 1990s in the corresponding metro areas, we investigate whether 1989-2000 changes in the metropolitan incidence of racial/ethnic discrimination correlate with fair housing enforcement activity during the 1990s. We found that higher amounts of state and local enforcement activity supported by HUD through its FHIP and FHAP programs (especially the amount of dollars awarded by the courts) were consistently associated with greater declines in discrimination against black apartment-seekers and home-seekers. The evidence does not support similar conclusions for housing market discrimination against Hispanics where the level of enforcement is much lower. |
| Keywords: | Housing Discrimination, Fair Housing Enforcement, and Paired Testing |
| JEL: | J15 K42 L85 R30 |
| Date: | 2005–05 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2005-16&r=reg |
| By: | Anupam Nanda (University of Connecticut) |
| Abstract: | At the time when at least two-thirds of the US states have already mandated some form of seller's property condition disclosure statement and there is a movement in this direction nationally, this paper examines the impact of seller's property condition disclosure law on the residential real estate values, the information asymmetry in housing transactions and shift of risk from buyers and brokers to the sellers, and attempts to ascertain the factors that lead to adoption of the disclosur law. The analytical structure employs parametric panel data models, semi-parametric propensity score matching models, and an event study framework using a unique set of economic and institutional attributes for a quarterly panel of 291 US Metropolitan Statistical Areas (MSAs) and 50 US States spanning 21 years from 1984 to 2004. Exploiting the MSA level variation in house prices, the study finds that the average seller may be able to fetch a higher price (about three to four percent) for the house if she furnishes a state-mandated seller's property condition disclosure statement to the buyer. The proportional hazard analysis of law adoption reveals that the number of disciplinary actions taken against the real estate licensees, and other institutional attributes lead to adoption of the property condition disclosure law in a state. |
| Keywords: | Property Condition Disclosure, Housing Price Index, Propensity Score Matching Event Study |
| JEL: | C14 K11 L85 R21 |
| Date: | 2005–11 |
| URL: | http://d.repec.org/n?u=RePEc:uct:uconnp:2005-47&r=reg |
| By: | Sophie Claeys,; Gleb Lanine; Koen Schoors |
| Abstract: | We focus on the conflict between two central bank objectives, namely individual bank stability and systemic stability. We study the licensing policy of the Central Bank of Russia (CBR) in 1999-2002. Banks in poorly banked regions, banks that are too big to be disciplined adequately and banks that are active on the interbank market enjoy protection from license withdrawal, showing a tacit concern for systemic stability. The CBR is also reluctant to withdraw licenses from banks that violate the individuals’ deposits to capital ratio, because this conflicts with the tacit CBR objective to secure depositor trust and systemic stability. |
| Keywords: | Bank supervision, bank crisis, Russia. |
| JEL: | G2 N2 E5 |
| Date: | 2005–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wdi:papers:2005-778&r=reg |
| By: | Supreena Narayanan (Madras School of Economics) |
| Abstract: | The financial system consists of specialized and non specialized financial institutions, of organized and unorganized financial markets, of financial instruments and services, which facilitate transfer of funds. Procedures and practices adopted in the markets, and financial interrelationships are also parts of this system. In product or other service markets, purchasers part with their money in exchange for something now. In finance, money “now” is exchanged for a “promise to pay in the future”. However, in product or service markets, if the object sold – from a car to a haircut – is defective, the buyers often find out relatively soon. On the other hand, loan quality is not readily observable for quite some time and can be hidden for extensive periods. Moreover, banks and non-bank financial intermediaries can also alter the risk composition of their assets more quickly than most non-financial industries, and banks can readily hide problems by extending loans to clients that cannot service previous debt obligations. Theoretically, the financial market facilitates allocation of resources efficiently, which involves quick dissemination of information and reaction to it. The financial markets are susceptible to manipulation as some participants have information that others do not that is information asymmetry is ubiquitous in financial markets. To overcome this problem corporate governance is required to ensure that suppliers of finance to corporations are assured that they get their return on their investment . Despite the existence of institutional and legal framework numerous financial scams continue to be perpetuated both in developed and developing countries.The objectives of this study are : a) To examine some of the major misdemeanors which perpetuated in the financial system in 1991 and 2001 in India . b) Understand the financial regulatory measures which have been adopted after the 1991 share scam in India and why despite such measures adopted a security scam has recurred in 2001. c) Examine the theoretical structure of corporate governance for analyzing security scams that have occurred in the 1990s and the new millennium. The second section contains a summary of the events that occurred leading to the share scams and financial frauds in India and abroad during the recent decade that shook the financial markets. The third section surveys the rationale for regulation of securities markets and the functional procedures adopted in India in the aftermath of the scams. The fourth section looks at the theoretical underpinnings of corporate governance which, is followed by a discussion of the shortcomings of the regulatory set up in India which fails to prevent the recurrence of financial misdemeanors. Financial Liberalization is a phenomenon that is almost all pervasive in the world today. While liberalization has led to substantial benefits in terms of increased transparency, it has ushered in opportunities of corporate misgovernance. This implies that the mechanism by which legal institutions ensure that suppliers of funds receive the return on investment is not sufficient or appropriate. Recent trends through the 1990s in India and abroad reveal how corporate governance has not been effective permitting unscrupulous and opportunistic individuals to manipulate the market in their favor. The process of financial market regulation ensures that important guidelines are issued regarding how primary dealers (brokers) should operate with regards to mode of operation, conduct, litigation, amount of business to be handled, management of risk, internal control etc. These security scams and financial scandals discussed here involved the manipulation of huge amounts of money. The perpetrators of these gross transgression had such a comprehensive knowledge of how the system worked that they manipulated it to their advantage operating in an opportunistic manner . The essence of the argument in is that the occurrence and reoccurrence of such security scams and financial scandals can be attributed to a failure of corporate governance in finance despite the existence of an functioning regulatory authority empowered with the legal sanctions. |
| JEL: | G |
| Date: | 2005–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:wpa:wuwpfi:0506012&r=reg |
| By: | Dhillon, Amrita (Department of Economics, University of Warwick); Rigolini, Jamele (The World Bank & University of Warwick) |
| Abstract: | We examine how institutions that enforce contracts between two parties, producers and consumers, interact in a competitive market with one-sided asymmetric information and productivity shocks. We compare an informal enforcement mechanism, reputation, the efficacy of which is enhanced by consumers investing in “connectedness,” with a formal mechanism, legal enforcement, the effectiveness of which can be reduced by producers by means of bribes. When legal enforcement is poor, consumers connect more with one another to improve informal enforcement; in contrast, a well-connected network of consumers reduces producers’ incentives to bribe. In equilibrium, the model predicts a positive relationship between the the frequency of productivity shocks, bribing, and the use of informal enforcement, providing a physical explanation of why developing countries often fail to have efficient legal systems. Firm-level estimations confirm the partial equilibrium implications of the model |
| Keywords: | Contracts, Institutions, Corruption, Reputation, Uncertainty. |
| JEL: | D02 D7 L14 O12 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:748&r=reg |