International Capital Rules: Harmonization, Conflict or Competition

Networks Financial Institute Policy Brief 2013-PB-03

31 Pages Posted: 24 Mar 2013

See all articles by Martin F. Grace

Martin F. Grace

Temple University - Fox School of Business & Management

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Date Written: March 19, 2013

Abstract

There is a conflict between the philosophies of United States (US) style capital regulation and that of the European Union (EU). While the conflict looks like it will not evolve into a real trade issue, there is a potential for misunderstanding of the pros and cons of the two systems. This paper will compare and contrast capital regulation in the EU and US focusing on the areas where competition, conflict and harmony may exist. The idea of capital regulation is to minimize the costs of insolvencies. This paper identifies some of the costs involved in capital regulation and offers an initial paradigm on how to compare the systems.

Keywords: Insurance Capital Requirements, Solvency II, Risk Based Capital Requirements

JEL Classification: G22, G23

Suggested Citation

Grace, Martin F., International Capital Rules: Harmonization, Conflict or Competition (March 19, 2013). Networks Financial Institute Policy Brief 2013-PB-03, Available at SSRN: https://ssrn.com/abstract=2237545

Martin F. Grace (Contact Author)

Temple University - Fox School of Business & Management ( email )

Fox School of Business and Management
1301 Cecil B. Moore Ave.
Philadelphia, PA 19122
United States

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