|
on Regulation |
| By: | Ojo, Marianne |
| Abstract: | Parts I and II of this paper are aimed at providing a comprehensive overview of, and responses to, four very vital components of the consultative processes which have contributed to the new framework known as Basel III. The papers will approach these components in the order of the consultative processes, namely, the capital proposals, the liquidity proposals and the Proposal to ensure the loss absorbency of regulatory capital at the point of non-viability. The capital proposals comprise proposals aimed at strengthening the resilience of the banking sector, the proposal relating to international framework for liquidity risk measurement, standards and monitoring and, the countercyclical capital buffer proposal. Whilst the capital proposals have been welcomed, there has been growing realization since the aftermath of the recent Financial Crisis that banks which have been complying with capital adequacy requirements could still face severe liquidity problems. As well as highlighting the importance of introducing counter cyclical capital buffers, the response to the countercyclical proposal draws attention to the need for greater focus on more forward looking provisions, as well as provisions which are aimed at addressing losses and unforeseen problems attributed to “maturity transformation of short-term deposits into long term loans.” The Committee's acknowledgement of negative incentives arising from the use of external ratings to determine regulatory capital requirements and proposals to mitigate these incentives is well - founded – however, regulators will also be able to manage, with greater ability, systemic risks to the financial system during such periods when firms which are highly leveraged become reluctant to lend where more market participants such as credit rating agencies, could be engaged in the supervisory process. |
| Keywords: | counter cyclical buffers; credit ratings; credit rating agencies; liquidity risks; pro cyclicality; loan loss provisions; financial crises; bank; regulation; leverage; capital; insolvency; financial crises; moral hazard; Basel III |
| JEL: | K2 E32 D8 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33082&r=reg |
| By: | Gorecki, Paul K.; Hennessy, Hugh; Lyons, Seán |
| Abstract: | This paper examines how local government planning regulations and charges affect the deployment of telecommunications infrastructure. We explore the economic rationale for local government regulation of such infrastructure, which we suggest should be based on managing negative externalities. Using data from Ireland, we find that the observed geographical pattern of impact fees is inconsistent with the economic rationale for them. A simple econometric model of the number of telecoms masts in each county also suggests that the level of impact fees is negatively associated with mast deployment. This paper also examines other regulatory factors that affect the provision of new infrastructure. We find wide regional variation in these regulations but are unable to quantify their impact on infrastructure provision. Such regulatory complexity places extra compliance burdens on private operators, which may in turn distort the level and regional pattern of network investment. We suggest further regional harmonisation of development policy towards telecoms infrastructure to avoid exacerbating regional disparities in rollout of services. |
| Keywords: | data/Econometric model/investment/Ireland/Policy/Regional disparities/regulation |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp401&r=reg |
| By: | Clifton, Judith; Díaz-Fuentes, Daniel; Comín Comín, Francisco |
| Abstract: | One of the consequences of major regulatory reform of the telecommunications sector from the end of the 1970s – particularly, privatization, liberalization and deregulation – was the establishment of a new business environment which permitted former national telecommunications monopolies to expand internationally. From the 1990s, a number of these firms, particularly those based in Europe, joined the rankings of the world’s leading Multinational Corporations. Their internationalization was uneven, however: while some firms internationalised strongly, others went abroad much slower. This article explores how the regulatory framework within which telecommunications incumbents evolved over the long-term helped shape their subsequent, uneven, paths to internationalization. Two cases representing ´maximum variation´ are selected: Telefónica, whose early and unrelenting expansion transformed it into one of the world’s most international of Multinational Corporations, and BT, whose international ventures failed and, with decline domestic shares, forced the firm to partial de-internationalization, becoming the least international of the large European incumbents. Long-term ownership, access to capital, management style and exposure to liberalization strongly influenced firms’ approaches to internationalization. |
| Keywords: | Regulation; Telecommunications; Internationalization; Europe; Privatization; Liberalization; Multinational Corporations |
| JEL: | L96 N74 L51 F23 N44 N84 L98 H82 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33017&r=reg |
| By: | Majumdar, Mukul (Cornell University); Yoo, Seung Han (Nanyang Technological University) |
| Abstract: | This paper analyzes "Influence Peddling" with interaction between human capital transfer and collusion-building aspects in a model, in which each government official regulates multiple firms simultaneously. We show that (i) there exists an "optimal" division rule for collusion between a sequence of "qualified" regulators and a firm; (ii) as the regulators increasingly benefit from the collusion, they strictly decrease regulation rates for the firm under collusion while strictly increasing regulation rates for a firm not under collusion; and (iii) post-government-employment restrictions are not "effective" policies, and an alternative policy can be suggested. |
| JEL: | D73 H83 L51 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:corcae:11-04&r=reg |
| By: | Daniel Montolio (Universitat de Barcelona & IEB); Francesc Trillas (Universitat Autònoma de Barcelona, SP-SP Center (IESE) & IEB) |
| Abstract: | We analyse the impact of regulation, industrial policy and jurisdictional allocation on broadband deployment using a theoretical model and an empirical estimation. Although central powers may be more focused and internalize interjurisdictional externalities, decentralized powers may internalize local horizontal policy spillovers and use a diversity of objectives as a commitment device in the presence of sunk investments. The latter may, for instance, alleviate the collective action problem of the joint use of rights of way and other physical infrastructures. In the empirical exercise, using data for OECD and EU countries for the period 1999-2006, we examine whether centralization promotes new telecommunications markets, in particular the broadband access market. The existing literature, in the main, claims it does, but we find no support for this claim in our data. Our results show that indicators of national industrial policy are a weakly positive determinant of broadband deployment and that different measures of centralization are either irrelevant or have a negative impact on broadband penetration. |
| Keywords: | Regulation, industrial policy, decentralization, broadband |
| JEL: | L50 L96 K23 H77 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ieb:wpaper:2011/8/doc2011-15&r=reg |
| By: | Clifton, Judith; Díaz-Fuentes, Daniel; Fernández Gutiérrez, Marcos; Revuelta, Julio |
| Abstract: | This essay concerns the ways in which public services – particularly household services such as communications, energy, water and transportation – have been regulated and deregulated, and analyses what consequences this has for users and citizens. Much of the deregulation of public services from the 1980s – liberalization, privatization and New Public Management – was justified by claims that reform would provide users with more choice, whilst they would receive cheaper and better quality services. Little account was taken of the fact that users are highly heterogeneous, that socio-economic differences might be important in determining their consumption of public services, and that this may not lead to socially optimum outcomes. By examining consumption patterns in two large European countries, Spain and the UK, through an analysis of revealed and declared preferences, this paper sheds light on how socio-economic differences among households help determine public service consumption. The main findings are that the supposed benefits of public service deregulation are not evenly spread across populations, and that specifically targeted “bottom-up” regulation from the demand-side could usefully address these issues, thus improving social welfare. |
| Keywords: | Regulation; Privatization; Public Services; Telecommunications; Electricity; Gas and water |
| JEL: | D18 L96 L51 D12 L95 L94 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33051&r=reg |
| By: | Bourreau, Marc (Telecom ParisTech and CREST-LEI, Paris); Cambini, Carlo (Polytechnic University of Turin); Dogan, Pinar (Harvard University) |
| Abstract: | In this paper, we analyze the incentives of an incumbent and an entrant to migrate from an "old" technology to a "new" technology, and discuss how the terms of wholesale access affect this migration. We show that a higher access charge on the legacy network pushes the entrant firm to invest more, but has an ambiguous effect on the incumbent's investments, due to two conflicting effects: the wholesale revenue effect, and the business migration effect. If both the old and the new infrastructures are subject to ex-ante access regulation, we also find that the two access charges are positively correlated. |
| JEL: | L51 L96 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp11-029&r=reg |
| By: | Christoph Böhringer; Jared C. Carbone; Thomas F. Rutherford |
| Abstract: | In a world where the prospects of a global agreement to control greenhouse gas emissions are bleak, the idea of using trade policy as an implicit regulation of foreign emission sources has gained many supporters in countries contemplating unilateral climate policies. Embodied carbon tariffs tax the direct and indirect carbon emissions embodied in imported goods. The appeal seems obvious: as OECD countries are, on average, large net importers of embodied emissions from non-OECD countries, carbon tariffs could substantially extend the reach of OECD climate policies. We investigate this claim by simulating the effects of embodied carbon tariffs with a computable general equilibrium model of global trade and energy use. We find that embodied carbon tariffs do effectively reduce carbon leakage. However, the scope for improvements in the global cost-effectiveness of unilateral climate policy is limited. The main welfare effect of the tariffs is to shift the burden of OECD climate policy to the developing world. |
| JEL: | F18 H23 Q54 Q56 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17376&r=reg |
| By: | Boettke, Peter |
| Abstract: | James Scott has written a detailed ethnography on the lives of the peoples of upland Southeast Asia who choose to escape oppressive government by living at the edge of their civilization. To the political economist the fascinating story told by Scott provides useful narratives in need of analytical exposition. There remains in this work a “plea for mechanism”; the mechanisms that enable social cooperation to emerge among individuals living outside the realm of state control. Social cooperation outside the formal rules of governance, nevertheless require “rules” of social intercourse, and techniques of “enforcement” to ensure the disciplining of opportunistic behavior. |
| Keywords: | economic development; self-regulation; political economy; peasant economy |
| JEL: | O17 P48 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:33067&r=reg |
| By: | Kiyono, Kazuharu; Ishikawa, Jota |
| Abstract: | This paper studies environmental management policy when two fossil-fuel-consuming countries non-cooperatively regulate greenhouse- gas emissions through emission taxes or quotas. The presence of carbon leakage caused by fuel-price changes a.ects the tax-quota equivalence. We explore each country.s incentive to choose an environment regula- tion instrument within a framework of a two-stage policy choice game and .nd subgame-perfect Nash equilibria. This sheds a new light on the question of why adopted policy instruments could be di.erent among countries. We also analyze the welfare e.ect of creating an interna- tional market for emission permits. International trade in emission permits may not bene.t the fuel-consuming countries. |
| Keywords: | global warming, carbon leakage, emission tax, emission quota, tax-quota equivalence, emission trading |
| JEL: | F18 |
| Date: | 2011–08 |
| URL: | http://d.repec.org/n?u=RePEc:hit:ccesdp:45&r=reg |