This is the second chapter of a book, Financial Regulation in the Global Economy, Herring is writing with Robert Litan. In this chapter they show how technological advances - dramatic reductions in transportation, telecommunications and computation costs - are creating an increasingly integrated...

We develop a proposal for a contingent capital (CoCo) requirement. A proper CoCo requirement, alongside common equity, would be more effective as a prudential tool and less costly than a pure common equity requirement. CoCos can create strong incentives for the prompt recapitalization of banks...

Although the growing literature on the importance of finance in economic growth contrasts bank-based financial systems with market-based financial systems, little attention has been paid to the role of the bond market. Correspondingly the role of the bond market has been very small relative to...