1st Edition

International Financial Co-Operation Political Economics of Compliance with the 1988 Basel Accord

By Bryce Quillin Copyright 2008
    240 Pages
    by Routledge

    240 Pages
    by Routledge

    The Basel Accord - now commonly referred to as "Basel I" - has exerted a profound influence on international financial politics and domestic prudential financial sector regulatory policy yet great controversy has always surrounded the Accord’s impact on the safety and competitiveness of the world’s largest financial institutions and the evolution of trans-national regulatory convergence.

    The author provides a comprehensive examination of the impact of the 1988 Basel Accord on the capital adequacy regulations of developed economies. The study seeks to understand if the Accord affected broad or isolated convergence of 18 developed states' bank credit risk regulations from 1988 to 2000, and also to understand what political economic variables influenced levels of regulatory isomorphism. Quillin creates a quantitative database of developed states’ interpretations of the Basel rules which shows that some persistent distinction remained in the way states implemented the Accord. He also explores why convergence emerged among a subset of states, yet not others, by testing a battery of political economic explanations.

    1. Introduction Part 1: Historical and Theoretical Perspectives on the 1988 Basel Accord 2. Political Economy of the 1988 Basel Accord and Capital Adequacy Regulation 3. Theorizing Degrees of Compliance with the Basel Accord Part 2: Quantitative Studies 4. Measuring Implementation and Explanatory Variables 5. Explaining Implementation-Quantitative Tests Part 3: Case Studies 6. Implementation of the Basel Accord in the United States 7. Implementation of the Basel Accord in Europe: The Case of France and Germany 8. Implementation of the Basel Accord in Japan 9. Conclusions and Extensions


    Bryce Quillin is Economist at the World Bank, USA.

    "This book provides a fascinating history of Basel I and countries reactions to this landmark regulatory development, and raises important questions about the current international implementaiton of Basel II" John Pattision

    "This book makes a distinctive contribution to the growing field of global governance. It examines an important international agreement for the stability of world's financial system and assesses the degree to which states actually implement what they commit to when it is a matter of soft law. As such, the book takes an important step forward for international relations scholars interested in the relative importance and efficacy of international regimes." William D. Coleman (McMaster University, Canada)