influence the design of bank capital regulation. Relative to a benchmark autarkic regime, higher capital requirements mitigate … regulation to optimally respond to interim performance signals by imposing higher capital requirements that mitigate asset … measurement in influencing the design of bank regulation through the implementation of capital requirements …

We assess the influence of competition and capital regulation on the stability of the banking system. We particularly … ask two questions: i) how does capital regulation affect (endogenous) entry; and ii) how do (exogenous) changes in the … competitive environment affect bank monitoring choices and the effectiveness of capital regulation? Our approach deviates from the …