Financial Markets Working Group

Financial Markets Working Group

The Financial Markets Working Group is a collection of seventeen university-based scholars with expertise across a wide range of economic issues relevant to the recent economic crisis. Drawing on Mercatus’s long-standing expertise in economic and regulatory analysis, members of the Financial Markets Working Group conduct research that addresses the causes and potential solutions to the economic downturn to offer productive ideas to address the serious problems in financial markets and encourage a sustainable economic recovery.


Todd Zywicki | Sep 29, 2015
A new paper for the Mercatus Center at George Mason University reviews the law and economics of consumer debt collection and its regulation and concludes that the CFPB should consider all the potential consequences of new regulation—both intended and unintended—to ensure that it will benefit consumers.
Jason Scott Johnston , Todd Zywicki | Aug 03, 2015
In a new study for the Mercatus Center at George Mason University, law professors Jason Scott Johnston and Todd Zywicki provide an overview and critique of the CFPB’s report. The study criticizes the report using primarily evidence supplied by the report itself. The CFPB’s findings show that arbitration is relatively fair and successful at resolving a range of disputes between consumers and providers of consumer financial products, and that regulatory efforts to limit the use of arbitration will likely leave consumers worse off.
Vern McKinley | Jun 18, 2015
The idea that banks are special was most succinctly summarized by Gerald Corrigan more than 30 years ago in an analysis prepared for the Federal Reserve Bank of Minneapolis, where Corrigan was president at the time. With the help of his mentor, then Federal Reserve Chairman Paul Volcker, his analysis pondered the characteristics of banks that make them special; justified the provision of a supporting safety net for banks based on financial stability concerns; and detailed the costs and restrictions that banks must subject themselves to. But the years since Corrigan’s analysis have seen two severe financial crises,and as the crisis of 2007–2009 clearly revealed, banks are not special, as the safety net was applied to a wide range of nonbank institutions. The Dodd-Frank Act was intended to cut back on the safety net by giving financial authorities wide discretion, but the right approach to rein in the safety net would be to cut back its beneficiaries…
Hester Peirce | Jan 06, 2015
In a new paper for the Mercatus Center at George Mason University, senior research fellow Hester Peirce demonstrates that FINRA is not structured in a way to produce high-quality regulation and is not accountable to the government, the industry, or the public.
Alexander Salter | Dec 04, 2014
In a new study for the Mercatus Center at George Mason University, scholar Alexander William Salter examines several different proposed rules that the Fed could follow. Salter provides a framework to help policymakers better understand how incentives and information can affect monetary policy and discusses discretion-based and rule-based approaches to monetary policy.
Hester Peirce | Nov 07, 2014
In a new study for the Mercatus Center at George Mason University, scholar Hester Peirce shows that such methods undermine public confidence in the regulatory process and harm regulated industries’ compliance efforts due to uncertain requirements and an ever-changing regulatory landscape.

Testimony & Comments

J. W. Verret | Sep 30, 2015
The explosive growth in federally backed loan and guaranty programs has been an appropriate focus of congressional oversight in recent years. The Office of Management and Budget (OMB) estimates the federal government supports over $3 trillion in loans and guarantees. Those loans and guarantees are often shrouded by indirect government support and unreasonable assumptions in government accounting practices. I submit that the Securities Investor Protection Corporation’s (SIPC) provision of securities custody insurance should be an appropriate part of that conversation.
Hester Peirce | Jun 11, 2015
Financial regulation should consist of clear, consistently enforced rules within which customers and financial institutions can freely interact. A well-functioning market enables people who need financing to obtain it efficiently and at a competitive price. Market forces reward financial companies that serve consumers well and discipline firms that fail to provide products and services in a form and at a price that consumers want.
Hester Peirce | May 13, 2015
The Dodd-Frank Wall Street Reform and Consumer Protection Act—does not make another crisis less likely. To the contrary, it sets the stage for another, worse crisis in the future. Government regulation—from bank regulation to housing policy to credit rating agency regulation—played a key role in the crisis. These policies shaped market participants’ behavior in destructive ways. Dodd-Frank continues that pattern.
Stephen Matteo Miller | Mar 12, 2015
The Bureau should employ its statutory authority to make exceptions to suspend the credit card database program so that it can inform Congress that the costs of such programs outweigh the benefits.
Hester Peirce, Kristine Johnson | Feb 04, 2015
This comment, which reiterates concerns laid out in the attached opinion piece, does not represent the views of any particular affected party or special interest group but is designed to assist FINRA as it considers implementing the Comprehensive Automated Risk Data System (CARDS).
Hester Peirce, Vera Soliman | Sep 10, 2014
The Bureau initiated its database without due consideration of the problem the Bureau was trying to solve or the costs and benefits of the database. Rather than expanding the database’s potential to cause unintended harm, the Bureau should return to the drawing board.


Patrick McLaughlin, Oliver Sherouse | Jul 20, 2015
RegData, an online interactive tool, allows us to quantify the regulatory surge of Dodd-Frank in context. By analyzing the text of regulations and counting the words and phrases that signify a mandatory or prohibited activity—such as shall, must, may not, prohibited, and required—RegData gives a more meaningful measure of regulation than simply counting the number of new rules created or the number of pages added to the Federal Register.



J. W. Verret | August 25, 2015
The Chinese financial market correction has sent ripples through the global economy. JW Verret breaks down the situation on MSNBC.


J. W. Verret | October 14, 2015
J.W. Verret analyzes Hillary Clinton’s plan to reform Wall Street on American Radio Journal.

Recent Events

Arnold Kling, Lawrence J. White, | May 02, 2012
Please join Mercatus Center financial services experts Anthony Sanders, Arnold Kling, and Larry J. White in discussing the future of GSEs, Fannie Mae and Freddie Mac, and the government's role in the U.S. housing market.


Tyler Cowen | Sep 12, 2013
Widely acclaimed as one of the world’s most influential economists, Tyler Cowen returns with his groundbreaking follow-up to the New York Times bestseller The Great Stagnation.
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