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Oatley, Thomas; Winecoff, W. Kindred --- "The Domestic Rooting of Financial Regulation in an Era of Global Capital Markets" [2012] ELECD 253; in Athanassiou, Phoebus (ed), "Research Handbook on Hedge Funds, Private Equity and Alternative Investments" (Edward Elgar Publishing, 2012)

Book Title: Research Handbook on Hedge Funds, Private Equity and Alternative Investments

Editor(s): Athanassiou, Phoebus

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781849802789

Section: Chapter 18

Section Title: The Domestic Rooting of Financial Regulation in an Era of Global Capital Markets

Author(s): Oatley, Thomas; Winecoff, W. Kindred

Number of pages: 25

Extract:

18. The domestic rooting of financial
regulation in an era of global capital
markets
Thomas Oatley* and W. Kindred
127




Winecoff 128




INTRODUCTION

The financial crisis that began in 2007 has forced academics and policy-
makers to re-examine regulatory policy at the domestic and international
levels. In an op-ed in the Washington Post during the height of the crisis,
Prime Minister Gordon Brown (as he then was) called for `cross-border
supervision of financial institutions; shared global standards for account-
ing and regulation; a more responsible approach to executive remunera-
tion that rewards hard work, effort and enterprise but not irresponsible
risk-taking; and the renewal of our international institutions to make them
effective early-warning systems for the world economy' (Brown 2008).
Similar responses were not only common following the current crisis,
they continue a history of introspection following financial upheavals: in
the United States (US), the Glass-Steagall Banking Act of 1933 ­ which
established federal deposit insurance and separated commercial from
investment banking ­ was a response to the waves of bank failures that
exacerbated the Great Depression. In 2010, the United Kingdom (UK)
reacted to the subprime financial crisis by moving to abolish its primary
financial regulator, the Financial Services Authority, and giving its
authority to several other agencies including the Bank of England and the
Consumer Protection and Markets Authority, a new prudential supervi-
sion authority.
At the international level, the Basel Committee on Banking Supervision
was formed to provide a platform for national governments ...