Abstract

http://ssrn.com/abstract=2037769
 
 

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How do Perceptions of Procedural Fairness Relate to Regulatory Compliance? Evidence from Financial Intermediaries


Juan P. Mendoza


VU University Amsterdam - Faculty of Economics and Business Administration

Henri C. Dekker


VU University Amsterdam - Department of Accounting

J. Wielhouwer


VU University Amsterdam

May 7, 2013


Abstract:     
Numerous countries have recently tightened the regulation of financial intermediation. However, little is known about the factors that affect financial intermediaries’ compliance behavior in practice. Based on the official compliance assessment of financial intermediaries in the Netherlands, which is conducted by the Authority for the Financial Markets, we examine how non-compliance (measured as the number of law violations) relates to financial intermediaries’ perception of procedural fairness (measured as the perception that the extensive regulation makes the firm’s activity unnecessarily difficult). Our results support the idea that perceived procedural fairness motivates firms to acquire knowledge and stay up-to-date with new regulations, which in turn enables them to achieve higher levels of compliance.

Number of Pages in PDF File: 35

Keywords: compliance, regulation, procedural fairness, financial intermediation

JEL Classification: G28, K22, K42

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Date posted: May 1, 2012 ; Last revised: May 7, 2013

Suggested Citation

Mendoza, Juan P. and Dekker, Henri C. and Wielhouwer, J., How do Perceptions of Procedural Fairness Relate to Regulatory Compliance? Evidence from Financial Intermediaries (May 7, 2013). Available at SSRN: http://ssrn.com/abstract=2037769 or http://dx.doi.org/10.2139/ssrn.2037769

Contact Information

Juan P. Mendoza
VU University Amsterdam - Faculty of Economics and Business Administration ( email )
De Boelelaan 1105
Amsterdam, 1081HV
Netherlands
Henri C. Dekker
VU University Amsterdam - Department of Accounting ( email )
Netherlands
Jacco L. Wielhouwer (Contact Author)
VU University Amsterdam ( email )
De Boelelaan 1105
Amsterdam, 1081HV
Netherlands
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