Four years have passed since the G20 Leaders tolled the bell to the shadow banking system at the Seoul Summit of 2010. The war against shadow banking, however, has just started on a global scale and there is still a long way to go for the international community to develop an effective...

This paper analyzes the causes and consequences of offshore financial centers (OFCs). Since OFCs are likely to be tax havens and money launderers, they encourage bad behavior in source countries. Nevertheless, OFCs may also have unintended positive consequences for their neighbors, since they...