policy and regulation

Page history last edited by brian 1 yr ago

  1. Policy and Regulations
  2. Balancing the need for regulations with innovation (and economic growth)
      1. Innovation
  3. European Union and regulation leadership
  4. External Links
      1. C cont.
      2. C cont.

 

 

 see also:  increased regulations of financial markets 2008

 

Policy and Regulations

 

Policy and regulation are important to watch.  As they change, there will be opportunities for entrepreneurs. 

 

 

Balancing the need for regulations with innovation (and economic growth)

 

In a macro sense;  too much regulation, and we see a lack of competition, and a lack of Innovation.  But too little regulation, and we see scandals, crises...and later, a call for more regulation.  Think about the results of the credit crisis in the USA (2007), and the resulting calls for more regulations... is that a good thing?  Well, on one hand we can see that wrong things happened, and regulation should be put in place to make sure it doesn't happen again...but, on the other hand... if we look at any developing nation, and in country after country...we see that over regulations cuts off competition, and stymies investment, and with underinvestment comes under performing asset classes.  In each of these emerging markets, we see that "deregulations" is often the key to spurring innovation, competition and economic growth. Think about this before you call for more regulations (and learn these lessons before willingly committing your market to more regulations).

 

Innovation

Wherever you see policy and regulation, you will see innovation (to get around the regulation).  Commercial Banking is one the most creative sectors when it comes to developing products to get around regulation.  For example, there has been massive Innovation in the financial sector when it comes to the securitization of mortgages (which partly is to blame for the subprime lending crisis). 

 

 

European Union and regulation leadership

 

One trend that is interesting is that the European Union has taken a lead in global regulations.  It has become common for deals and acquisitions to be approved in the US, only to be held up in Europe.  Also, the European Union has become the global standard setter for many aspects of business.

 

see:  European Union and global regulations

 

 

External Links

 

 

 

C cont.

C cont.

 

 

 

 

 

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