A Stigler View on Banking Supervision

  title={A Stigler View on Banking Supervision},
  author={Friedrich Heinemann and Martin Sch{\"u}ler},
The system of banking supervision in Europe is undergoing substantial reforms. According to Stigler’s capture theory regulation often follows the preferences of producers. Therefore, the interests of the financial industry might be a major driving force for the ongoing supervisory reform debate. This paper identifies possible interests of the regulated industries: Either they might favour strict supervision to create barriers for entry and thus to reduce competitive pressure in their market. Or… CONTINUE READING