Research Notes in Prudential Regulation: Incentive-Based Approach against Excessive Risk-Taking

The strong expansion of the financial industry relative to the real economy and the resurgence of pervasive financial instability, from the 1980s onwards, have moved the reform of financial regulatory devices to the top of the economic policy agenda worldwide. This environment has triggered renewed academic interest in the structure and conduct of banking regulation. The present dissertation lies within this area of investigation by offering research notes in prudential regulation that have been prepared in the context of the European University Institute doctoral program in economics. This dissertation is made of three articles dealing with the question of public disclosure requirements, the intensity of private and public monitoring and the supervision of financial conglomerates, respectively. The three pieces of the thesis are self-contained and each of them can be read independently of one another. The common denominator of the three pieces of this dissertation is the question about the best way to tackle the problem of providing banks and related financial intermediaries with the right incentive structure to encourage prudent behaviors.