The Political Economy of Financial Regulation: Evidence from US State Usury Laws in the 19th Century

• 成果类型: Article
• 署名作者: Benmelech, Efraim; Moskowitz, Tobias J.
• 署名单位: Harvard University; University of Chicago; National Bureau of Economic Research
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/j.1540-6261.2010.01560.x
• 发表日期: 2010
• 页码: 1029-1073
• 关键词: NEW-WORLD; BANK; GROWTH; restrictions; revolution; matter; LIBERALIZATION; institutions; deregulation; COMPETITION

摘要

Financial regulation was as hotly debated a political issue in the 19th century as it is today. We study the political economy of state usury laws in 19th century America. Exploiting the wide variation in regulation, enforcement, and economic conditions across states and time, we find that usury laws when binding reduce credit and economic activity, especially for smaller firms. We examine the motives of regulation and find that usury laws coincide with other economic and political policies favoring wealthy political incumbents, particularly when they have more voting power. The evidence suggests financial regulation is driven by private interests capturing rents from others rather than public interests protecting the underserved.