We study financial regulation when some financial institutions or capital flows are unregulated and there are pecuniary externalities. Optimal financial regulation is scaled by a ``regulatory arbitrage multiplier.'' The contribution of an unregulated actor to regulatory arbitrage can be...

Carbon taxation has been studied primarily in social planner or infinitely lived agent models, which trade off the welfare of future and current generations. Such frameworks obscure the potential for carbon taxation to produce a generational win-win. This paper develops a large-scale, dynamic...