Disclosure Regulation in the Commercial Banking Industry: Lessons from the National Banking Era |
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Authors: | JOÃO GRANJA |
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Institution: | Booth School of BusinessThe University of Chicago |
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Abstract: | I exploit variation in the adoption of disclosure and supervisory regulation across U.S. states to examine their impact on the development and stability of commercial banks. The empirical results suggest that the adoption of state‐level requirements to report financial statements in local newspapers is associated with greater stability and development of commercial banks. I also examine which political constituencies influence the adoption of disclosure and supervisory regulation. I find that powerful landowners and small private banks are associated with late adoption of these regulations. These findings suggest that incumbent groups oppose disclosure rules because the passage of such rules threatens their private interests. |
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Keywords: | E44 E51 G21 G28 G32 G38 H23 K22 K23 L51 M41 M48 N11 N21 N41 N81 disclosure regulation bank regulation enforcement financial stability bank failures financial development political economy of regulation |
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