Financial Regulation and Nation State Crisis Management: Evidence from Germany, Ireland and the UK

26 Pages Posted: 14 May 2013

See all articles by William Forbes

William Forbes

Loughborough University - Business School

Sheila O'Donohoe

Waterford Institute of Technology

Jörg Prokop

University of Oldenburg - Finance and Banking; ZenTra - Center for Transnational Studies

Date Written: May 13, 2013

Abstract

We study the unfolding of the credit crisis until 2008, and the diversity of policy responses in Germany, Ireland, and the UK. We show that although the channels through which these three European states manifested financial distress were different, the crisis evoked similar reactions by regulators and national governments. Our conclusion emphasise the role of state regulatory bodies as a primary source of the “rules of the game” in financial markets, and they support several of the policy measures taken in the aftermath of the credit crisis. In particular, we argue that adverse regulatory incentives at a national level require strengthening regulation at the European level, to avoid national capture and a resulting race to the bottom by national financial regulators.

Keywords: regulation, Europe, banking, financial crisis

JEL Classification: E44, G01, G18, H11, H12

Suggested Citation

Forbes, William Patrick and O' Donohoe, Sheila Frances and Prokop, Jörg, Financial Regulation and Nation State Crisis Management: Evidence from Germany, Ireland and the UK (May 13, 2013). ZenTra Working Paper in Transnational Studies No. 18/2013. Available at SSRN: https://ssrn.com/abstract=2264058 or http://dx.doi.org/10.2139/ssrn.2264058

William Patrick Forbes (Contact Author)

Loughborough University - Business School ( email )

Ashby Road
Loughborough
Nottingham NG1 4BU, LE11 3TU
Great Britain

Sheila Frances O' Donohoe

Waterford Institute of Technology ( email )

Waterford
Ireland

Jörg Prokop

University of Oldenburg - Finance and Banking ( email )

Germany

ZenTra - Center for Transnational Studies ( email )

Ammerländer Heerstraße 138
Oldenburg, 26131
Germany

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