Key Concepts of Financial Regulation - Rule making

Abstract

Legislators and regulators use a number of concepts to cast regulatory goals into regulatory rules. This range of concepts ranges from highly intrusive, such as prohibition of a certain activity, to little intrusive, such as disclosure of certain facts. This paper systematizes the various available regulatory concepts and proves their continued validity in the context of modern technology-enabled financial services.

This paper was first written as an introductory text to one of the author's lectures on International Financial Regulation.

Keywords: financial regulation, disclosure, quantitative limitations, risk modelling, safety nets

JEL Classification: G1, K22