History of state regulation of financial markets: Foreign practices and lessons for Ukraine

Abstract

State regulation of financial markets is important for the country’s economic policy, and its historical assessment helps identify factors of success or failure and best global practices for application in Ukraine. The purpose of this study was to investigate the history of state regulation of financial markets and to analyse the practices of forming the financial system of different countries. The main scientific methods used were analysis, abstraction, deduction, historical method, forecasting, comparison. During the study, the history of state regulation of financial markets of four countries was evaluated: the United States of America, Germany, China, and Hong Kong (as a separate administrative region of China) and Poland. It was shown that all of them have certain features in terms of their historical formation and three selected characteristics, namely the level of centralization, the openness of the financial system and the role of the state in it. Based on the analysed information, relevant conclusions were formed regarding what the control over the financial system in Ukraine should be. The level of corruption of state structures is one of the key aspects that must be considered when developing the country’s financial policy. Considering the elevated level of corruption in Ukraine, it is recommended to reduce the role of the state in regulating the financial system, implement its decentralization, and free access to the market. These measures will minimize corruption, establish competitive relations between institutions, and delegate responsibilities. This will contribute to the achievement of more effective regulation of the financial system in Ukraine, considering the needs of the country’s reconstruction after the end of the war. Given the geographical and historical proximity, the regulatory principles used in Poland can be a valuable experience for improving the Ukrainian system. The study brings new knowledge in terms of the theory of financial markets, and offers a more profound understanding of the specific features of the development of the economy of Ukraine