Financial Safety and Consumer Protection Regulation

Financial Politics, Approval Regulation and Consumer Finance -- Daniel Carpenter

Spurred in part by the financial crisis of 2008 and the inadequacy it reveals in existing technical, empirical and historical scholarship on financial regulation, and motivated in part by the work of Elizabeth Warren of Harvard Law School, I have begun a project, funded by the Tobin Project on Economic Regulation, on the design of a consumer finance regulator and its possible regulatory mechanisms. My work has been funded by a grant from the Behavioral Economics and Consumer Finance Program of the Alfred R. Sloan and Russell Sage Foundations. In addition, some of the theoretical and technical work in this project was supported by the National Science Foundation (SES-0076452 and SES-0519082).

Theoretical Papers

"Approval Regulation and the Endogenous Provision of Confidence: Theory and Analogies to Licensing, Safety and Consumer Finance Regulation," Regulation and Governance 4 (4) (December 2010) (w Justin Grimmer and Eric Lomazoff) [preprint pdf]

Empirical and Historical Papers on Recent Changes in Financial Regulation

"Institutional Strangulation: Bureaucratic Politics and Financial Reform in the Obama Administration" Perspectives on Politics 8 (3) (September 2010): 825-846

"The Contest of Lobbies and Disciplines: Finance Politics and Regulatory Reform in the Obama Administration," Chapter Four in Lawrence Jacobs and Theda skocpol, eds, Reaching for a New Deal: President Obama's Agenda and the Dynamics of U.S. Politics, (New York: Russell Sage Foundation, 2010).


Approval Regulation: Theory, Empirics and Possible Applications to Consumer Finance
 [pdf]; presentation to Federal Reserve Bank of Cleveland, Conference on Consumer Protection in Finance; September 11, 2009.

Policy Documents and Editorial Essays

At the request of the Committee on Financial Services of the U.S. House of Representatives [including Rep. Brad Miller and Chairman Barney Frank], I have been working on administrative, legal and regulatory features of the proposed Consumer Financial Protection Agency. The idea for such an agency was originally proposed by Elizabeth Warren, was later proposed in a bill by Reps. Delahunt and Miller, and has been written into proposed legislation by the Obama Administration. The following documents reflect my ideas only, and are not necessarily endorsed or supported by any member of the House of Representatives or of the Tobin Project.

Considering a Consumer Finance Safety Commission [The Tobin Project] [pdf]

Proposal for a modified file-and-use process for consumer finance regulation with committed experimentation and public scrutiny of unrecognized loan/credit instruments [pdf]

Demonstrative Consumer Regulation by the Federal Reserve: An Exercise in Reputation- and Turf-Based Governance? [pdf]

"How to Restore Consumer Confidence,"Boston Globe [op-ed], September 8, 2009