Reordering the Marketplace: Competition Politics in European Finance*

Abstract

Over the last 15 years, Europe has seen the liberalization of national financial markets as well as the integration of these markets and their governance through the introduction of the 'Lamfalussy process'. This article argues that we can best understand these shifts as one integrated project of market-building in Europe, guided by distributional struggles over the terms of mutual markets access. To comprehend the complex linkages between private and public actors across levels of governance, we have to look beyond macro-theories of integration and financial liberalization upholding an analytical state-market dichotomy and adopt an integrative approach to theory, instead. Using the example of securities markets, this article argues that 'competition politics' are key to understanding European financial market integration. Copyright 2006 Blackwell Publishing Ltd.

The interest ecology of financial regulation: interest group plurality in the design of financial regulatory policies

“…First, most studies of interest groups in financial regulation have focused on specific policies, institutions or actors through in-depth qualitative case studies (Lall, 2012;Quaglia, 2008;Woll, 2013;Mügge, 2006), thus making a general overview of this terrain difficult to ascertain. While this qualitative literature has greatly informed the hypotheses we test, our analysis complements existing scholarship through a quantitative analysis aimed at observing general but context-varying trends in the participation of interest groups in financial regulatory politics (see also Young and Pagliari 2015).…”

“…These conditions are however not fixed: the interest group environment in financial regulatory policymaking may be dynamic and changing. For instance, different empirical studies have documented how the regulated financial industry has occasionally been constrained by the opposition faced different groups -for example by NGOs and other non-business groups (Clapp & Helleiner, 2012;Kastner, 2014), as well as other business groups inside and outside the financial industry (Mügge, 2006;Young, 2012;Pagliari & Young, 2014).…”

The phantom of Palais Brongniart: economic patriotism and the Paris Stock Exchange

“…First steps toward stock market demutualization were taken as early as 1984 with reforms authorizing commercial banks to branch out into investment banking (Lordon 1997;Feiertag 2005 The French drive for financial sector competitiveness through liberalization was also in line with policies promoted by the European Commission. The latter aimed at the marginalization of direct state intervention in the ownership structure, governance, or strategy of firms; integration of the European financial sector through competition; and coordination of conflicting interests through marketization (Mügge 2006;Posner 2009;Jabko 2006). Underlying these policies was the conviction that financial market integration was more likely to result from enhanced competition between stock exchanges than from enhanced cooperation among fiercely competing stock exchanges.…”

The politics of insurance regulation and supervision reform in the European Union

“…This explanation coincides with a supranational governance approach to European financial market integration (Sandholtz and Stone-Sweet, 1998). A third explanation focuses on the role of the private sector, in particular transnational capital, keen to expand and operate across border (Van Apeldoorn, 2002;Bieling, 2003;Mu¨gge, 2006; for a qualification of this argument see Macartney, forthcoming; for an interpretation playing down the role of economic interest groups in financial market integration see Grossman, 2004). This explanation can be regarded as a variation of the supranational governance approach, which has much in common with its ancestor, the neo-functionalist approach (Haas, 1968), which postulates the shifting of loyalties of interest groups from the national level to the EU level.…”

“…The regulatory framework of the European Union (EU) is crucial in the multi-level governance of financial services because the national legislation of the member states is shaped by, or at the very least incorporates EU rules. After the re-launch of the completion of the Single Market in financial services through the Financial Services Action Plan (FSAP) and the setting up of the so-called Lamfalussy architecture (see Mu¨gge, 2006;Quaglia, 2007), there has been intense activity in the EU concerning the regulation of securities markets, as well as in the banking sector (for an overview see Posner, 2007;Macartney and Moran, 2008). Belatedly, in the late 2000s, the EU undertook a significant reform of the framework for insurance regulation and supervision through the Solvency II directive, which is designed to set in place a risk-based, principle-based approach to the prudential regulation of insurance companies.…”