Looking Forward by Looking Backward: The Future of Consumer Finance and Financial Protection

19 Pages Posted: 17 Feb 2024 Last revised: 3 May 2024

See all articles by Todd J. Zywicki

Todd J. Zywicki

George Mason University - Antonin Scalia Law School; PERC - Property and Environment Research Center

Date Written: February 15, 2024

Abstract

This essay was prepared for “The Future of Financial Regulation Symposium” October 6, 2023, sponsored by the C. Boyden Gray Center. I assess the future of consumer finance and financial protection by looking to the lessons of history. Consumer finance and financial protection in the United States exhibits a spontaneous evolution driven by changes in technology and consumer preferences in a repeated cycle. In general, consumers use consumer finance in a manner consistent with the predictions of rational behavior in order to improve their lives. Consistently, this goal of consumer betterment runs up against paternalistic and repressive laws, which attempt to prevent the beneficial evolution of technology and competition. Eventually economic forces overwhelm regulatory repression for the betterment of consumers.

I track three distinct eras in the evolution of consumer finance and financial regulation that provide a roadmap to the future evolution in the virtual era and emergent threats to consumers from private and public sources, including the growing use of the consumer finance system to infringe on the exercise of constitutionally-protected values.

Keywords: Consumer Finance, Consumer Financial Protection, usury law, financial regulation

JEL Classification: D1, D14, D15, D18, K12

Suggested Citation

Zywicki, Todd J., Looking Forward by Looking Backward: The Future of Consumer Finance and Financial Protection (February 15, 2024). Journal of Law, Economics, and Policy, Vol. 19, pp. 223–240 (2024), George Mason Law & Economics Research Paper No. 24-03, Available at SSRN: https://ssrn.com/abstract=4728037

Todd J. Zywicki (Contact Author)

George Mason University - Antonin Scalia Law School ( email )

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PERC - Property and Environment Research Center

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