Regulatory Harmonization versus Diversity

DEPARTEMENT D'ECONOMIE ET SCIENCES DE LA DECISION

Intervenant : Monika MRAZOVA 

Professor at Geneva Shcool of Economics and Management

Viseoconférence

Abstract :

“In a world where countries have different regulatory preferences and where firms incur fixed costs of regulatory heterogeneity, we explore the role for international regulatory cooperation. First, we characterize non-cooperative regulatory standards and show that countries may decide to harmonize standards spontaneously. Such harmonization is however inefficient. We then characterize the cooperative efficient policies and show that regulatory agreements help countries reach efficient outcomes either by harmonizing or encouraging diversity. We also show that cooperative harmonization may be bad for world welfare when agreements are influenced by producer lobbying.”

(joint work with Giovanni Maggi)