Incentives On Banking Supervision: Theoretical Basis And Policy Responses

In modern economics banking is so important that it must be efficient regulated.Throughout the world,many academic research have been development,and many valuable achievement.However, most research consider it as it stands, just see it from a very narrow viewpoint,and is lack of a logic,systematic thorey framework as its infrastructure. This article look incentive as cut-in angle, and study banking regulation systematically and entirely.About 100 years,banking regulation has went through three moments:administrative regulation,standardization and IMA.As far as the first one concerned,although it is helpful for the maintenance of the financial stabilization,but it cost financial efficiency.lt cost not only the regulation authority but also banking a lot.lt impede banking innovation,so it is banking oppression.Standardization is also too rididify and lack of agility.So it still can not avoid the administrative regulation's drawback. .Furthermore ,fmancial firenet connive banking's adventure operation without measure,on the contrary,banking's moral hazard become more serious.In a short , administrative regulation,standardization and financial firenet all cannot solve banking's moral hazard,and these regulation are not incentive.Game theory and information economics make great breakthrough in economic incentive theory.In it ,theory of asymmetry information,incentive mechanism devise,moral hazard and excellent incentive contract make basic theory infrastructure for the solution moral hazard under asymmetry information,and take inspire for banking regulation.Recently,many incentive banking regulation instrument have been development,including IMA by basic banking regulation committee,PCA by the FED,long-term subordinated bond arrangement,and a more incentive firenet.Both in theory and in pratce ,they have been tested ,and get a relative not bad result to some extent,but there are still many problems should be solvedAs far as China's banking regulation is concered,it is lack of incentive,so the banking is lack efficiency and banking hazard is very serious.So the.regulation revolution should be developed at once ,to set up incentive banking regulation ,we must improve the financial zoology ,promote IMA,subordinated bond supervision and incentive financial firenet,including sound central bank's last incentiveresort,deposit insurance, baking bankruptcy under market principle...