Our article considers whether the existence of a global banking market has resulted in the convergence of bank supervisory policy among different nationally-based regulatory regimes. In particular, we consider whether regulatory authorities in the United States and Great Britain, as providers of regulatory services, compete on the basis of the "net regulatory benefit" (NRB) that they provide to their respective regulatees, i.e., banks. After a detailed examination of the history of bank regulation in the US and UK, we observe that there is no clear trend towards convergence by competition. We find that, while regulatory competition may play an important role in the evolution of regulatory regimes, the competitive model -- particularly as enshrined in the NRB -- does not account for a number of other equally significant determinants of change. We conclude by identifying three important determinants of regulatory change which are not reflected in the NRB model: path dependence, the power of purely domestic concerns, and the impact of, what we call, "negotiated convergence."
Heidi Mandanis Schooner & Michael Taylor, Convergence and Competition: The Case of Bank Regulation in Britain and the United States, 20 MICH. J. INT’L L. 595 (1999).