Unregulated Entities Research Articles

Online Sexual Solicitation of Children and Adolescents.

Technological advances have exploded in the new millennium. The Internet provides many opportunities to enrich the lives of youth by providing greater access to learning opportunities, valuable resources, and positive social interactions with peers. However, the Internet is a relatively new and unregulated entity that can also place children and adolescents at risk for a variety of negative and potentially dangerous exposures. One such risk is online sexual solicitations and interactions with older adolescents, peers, and adults. This continuing education article will explore online sexual solicitation of child and adolescents in terms of definition, epidemiology, predictors, consequences, and implications for practice.

Strengthening technology risk management in mobile money lending

Innovative mobile money services have grown tremendously in the East African market. While there are positive effects of technology-enabled financial inclusion, risks exist. This study sought to strengthen the capacity of technology risk management by proposing practices and strategies that can protect the financial technology ecosystem. Applying the ISACA Risk IT Framework, data was collected in June 2019 from the leading digital lenders in Kenya. The study found that while regulated mobile lenders have an IT risk management environment that is viewed as a critical success factor, unregulated entities have minimal integration of IT risk management essentials. This study is useful to many developing countries where governments are working towards having secure and strong financial systems that contribute to the Millennium Sustainable Development Goals. Regulators and practitioners must ensure the financial technology lending ecosystem is protected from risks that could reverse gains made from witnessed developments in financial inclusion.

Institutional Investors, the Dollar, and U.S. Credit Conditions

This paper documents that an appreciation of the U.S. dollar is associated with a reduction in the supply of commercial and industrial loans by U.S. banks. An increase in the broad dollar index by 2.5 points (one standard deviation) reduces U.S. banks' corporate loan originations by 10 percent. This decline is driven by a reduction in the demand for loans on the secondary market where prices fall and liquidity worsens when the dollar appreciates, with stronger effects for riskier loans. Today, the main buyers of U.S. corporate loans---and, hence, suppliers of funding for these loans---are institutional investors, in particular mutual funds, which experience outflows when the dollar appreciates. A shift of traditional financial intermediation to these relatively unregulated entities, which are more sensitive to global developments, has led to the emergence of this new channel through which the dollar affects the U.S. economy, which we term the secondary market channel.

Performance measurement in Australian water utilities. Current state and future directions

AbstractEnsuring universal and affordable water supply is a central objective of government. An efficient water supply sector plays a primary role in ensuring this objective is met. Scale economies and capital‐intensive immobile assets means monopoly emerges as the dominant organizational form, and when combined with an essential character, a strong case exists for economic and technical regulation. Yet diversity in water service provider scale means economic regulation, which is costly, is not always viable. A comprehensive performance monitoring and reporting regime for water service providers is thus crucial. It is crucial for oversight of unregulated entities, and for regulated entities in generating competition by comparison. In this article, we undertake an expansive literature review and summarize approaches to performance measurement by the water industry. Academic literature reveals researchers have centered their approach using comprehensive methods such as data envelopment analysis and stochastic frontier analysis. With the exception of the Victorian Essential Services Commission, the Australian Industry persists with partial indicators. Given water and sewerage price increases of more than 100% in real terms from 2005 to 2014, we find a strong case for implementing advanced methods to address the task of providing a holistic picture of utility performance.

Global Investors, the Dollar, and U.S. Credit Conditions

This paper documents that an appreciation of the U.S. dollar is associated with a reduction in the supply of commercial and industrial loans by U.S. banks. An increase in the broad dollar index by 2.5 points (one standard deviation) reduces U.S. banks' corporate loan originations by 10 percent. This decline is driven by a reduction in the demand for loans on the secondary market where prices fall and liquidity worsens when the dollar appreciates, with stronger effects for riskier loans. Today, the main buyers of U.S. corporate loans-and, hence, suppliers of funding for these loans-are institutional investors, in particular mutual funds, which experience outflows when the dollar appreciates. A shift of traditional financial intermediation to these relatively unregulated entities, which are more sensitive to global developments, has led to the emergence of this new channel through which the dollar affects the U.S. economy, which we term the secondary market channel.

Regulating Motivation: A New Perspective on the Volcker Rule

The myriad problems with the Dodd-Frank Act’s ban on proprietary trading by banks have led to a rare bipartisan consensus: the Volcker Rule must be pared back or even repealed. At the root of the Rule’s problems is the fundamental definitional challenge posed by the current approach. The definition of banned proprietary trading turns on the motivation underlying a trade, which is difficult for regulators to determine. Regulators must adopt either a hardline approach that risks deterring banks from engaging in core financial intermediation functions or a more permissive approach that risks the continuance of speculative gambles that threaten the financial system. We propose a new paradigm for achieving the Volcker Rule’s objectives that resolves this dilemma. Rather than define and ban proprietary trading, regulators should simply ban banks from paying traders on the basis of trading profits. Our proposal takes advantage of the competition between proprietary trading firms in two markets: they compete in the securities market to identify and exploit trading opportunities and they compete in the labor market to hire and motivate the best traders. Because speculative trading is a zero-sum game, handicapping banks relative to unregulated entities, such as hedge funds, in the labor market for traders would generate powerful incentives for banks to get out of the trading game. Our simple compensation-based approach would likely be more effective at ending speculative trading at banks---and do so at lower cost---than the complex and loophole-ridden current approach.

Super Connected: Outside Groupss Devotion to Individual Candidates and Political Parties Disproves the Supreme Court's Key Assumption in Citizens United That Unregulated Outside Spenders Would Be Independentt

Nearly half of the unregulated outside groups that sought to influence the 2012 presidential and congressional elections spent their money to aid just one candidate. Ten additional groups, which accounted for nearly 30 percent of spending by unregulated entities in the 2012 elections, existed to aid either the official Democratic or Republican parties. In total, candidate-specific and party-allied groups accounted for more than 65 percent of all spending by unregulated outside groups in the 2012 elections. Such groups made up seven of the top eight unregulated outside spenders. These findings undercut the key premise relied upon by the Supreme Court in its 2010 decision in Citizens United v. Federal Election Commission, which paved the way for outside groups to use unlimited contributions from individuals, corporations or unions to influence elections. The court based its Citizens United decision on its assumption that the new electioneering spending it permitted would be by organizations that acted independently of candidates and parties.

Climate Policy Design with Correlated Uncertainties in Offset Supply and Abatement Cost

Current and proposed greenhouse gas cap-and-trade systems allow regulated entities to offset abatement requirements by paying unregulated entities to abate. These offsets from unregulated entities are believed to contain system costs and stabilize allowance prices. However, the supply of offsets is highly uncertain and may be correlated with other sources of uncertainty in emissions trading systems. This paper presents a model that incorporates both uncertainties in the supply of offsets and in abatement costs. We numerically solve a dynamic stochastic model, with parameters relevant to the U.S. climate debate, under a variety of parameter settings, including a system that includes allowance price controls, risk aversion, and competitive offset purchasing. We find that as uncertainty in offsets and uncertainty in abatement costs become more negatively correlated, expected abatement plus offset purchase costs increase, as does the variability in allowance prices and emissions from the regulated sector. These results are amplified with risk sensitivity, larger annual offset limits, and competitive offset purchasing. Imposing an allowance price collar substantially mitigates cost increases as well as the variability in prices, while roughly maintaining expected environmental outcomes. In contrast with previous literature we find a collar may also mitigate emissions variability.

Regulatory Factors that Contributed to the Global Financial Crisis

Normal 0 false false false MicrosoftInternetExplorer4 The source of the global financial crisis of 2008 may be viewed from two ideological perspectives: regulatory failure in the credit risk transfer (CRT) market; and monetary laxity, pointing to the inherent nature of financial regulation. This paper is an exposition of the regulatory factors that contributed to the global financial crisis by highlighting the weaknesses in the CRT market believed to have catalyzed the present economic slowdown. These factors include active involvement of unregulated entities in the market; divergent regulatory treatment of CRT transactions across different financial institutions; insufficient supervisory data on CRT transactions; and insufficient capital requirement for CRT transactions. The paper addresses the presence of monetary laxity evidenced by the procyclical nature of some policies that reinforced the market downturn. It looks into each factor closely before concluding that regulations are by no means, an easy task. They have to constantly strike a balance between allowing innovations for the development of the financial markets to support further development in the real economy and ensuring a stable financial system. The bottom line is for regulators to caution themselves against over-regulation that would inhibit innovation which is a tempting proposition amidst all these issues on regulatory failure.

Corporate governance in the Indian banking industry

The paper makes a case for corporate governance as an internal mechanism in banks, and therefore influenced by cultural issues, to dovetail with the overriding compulsions of prudential regulation, that sets the boundaries for systemic stability. The dynamic changes in the structure of global financial markets and the blurring of boundaries between different players — banks, investment banks and hedge funds, pose new challenges for financial regulators. This is especially crucial in the context of structural mechanisms that are in place to run the new financial conglomerates. From a regulatory perspective, the key issue would be the presence of unregulated entities/holding companies in the structure. The presence of any unregulated entity within the Bank Holding Company/Financial Holding Company structure, especially an unregulated intermediate holding company, may prove to be a weak link in the entire structure, providing scope for regulatory arbitrage. As is evident from the recent sub-prime problems originating in the United States, all financial entities are interdependent and the collapse of any one, not necessarily a commercial bank, involves a systemic risk and may propel the financial regulator to save it. In the context of overriding compulsions of financial stability and the inherent limitations of any external regulation to anticipate all innovative, exotic derivative products and eliminate the propensity of excessive risk-taking by a bank/financial entity, regulators worldwide, and in India, are placing more and more responsibility on bank boards. This has entailed, on the part of the board, a better quantitative understanding of the risks inherent in specific lines of activity and a clear assessment of possible impact on the financials. In the Indian context, the Reserve Bank of India (RBI) has put in place detailed regulations related to the composition of bank boards, the ‘fit and proper’ criteria for appointment of directors, transparency and disclosure norms for derivative products, related-party transactions, risk-based internal audit and other crucial components of banks' corporate governance architecture. The systemic risk posed by such financial conglomerates (FC), because of possible regulatory arbitrage, is sought to be plugged by a system for all the identified FC whereby a designated entity within the conglomerate reports to its lead regulator. In order to monitor the intra-group transactions and exposures, information from the designated entities of each FC is obtained by the principal regulators and a system for exchange of information among the regulators has been put in place. Mixed ownership of government (as a majority shareholder) and private (almost all public sector banks are listed on the stock exchange) also poses a unique challenge of divergent objectives of shareholding and the issues of reconciling them. In the final analysis, corporate governance is a continuous process of evolving best practices in response to market developments. RBI cannot be complacent. This is the constant thrust of RBI's initiatives in ensuring a vibrant corporate governance framework.

Les transformations du private equity

Changes in private equity Private equity funds have amassed real power in recent years. They have maintained the same objective of maximising the return on their investments, but are now adopting more sophisticated strategies and are having an increasing structuring effect on a number of industry sectors. Today’s financial crisis, which has made financing more expensive and harder to come by, will probably have only a temporary impact on the development of these funds. That said, the pressure they are facing is growing in pace with their impact on the stock markets and on the industry. Many have called for stepping up controls and transparency requirements on these unregulated entities. JEL Classification : G11, G23, G24

Antitrust issues concerning R&D cross-subsidization: A case study of US telecommunications

This article examines the treatment of cross-subsidization under the antitrust laws in the context of a US telecommunication service industry that is regulated and characterized by rapidly changing technology and significant R&D expenditures. With particular reference to the divested Bell operating companies under the Modification of Final Judgment, the article focuses on cross-subsidy concerns that would flow from the funding of R&D by a regulated firm if it were affiliated with unregulated entities. The article suggests an economic-based analytical framework, and possible remedies against potential anticompetive effects, as a substitute for automatic application of legal presumptions of abuse of market power.