The United States and Europe in the Global Arena

Abstract

During the past two decades or so, capital controls have been lifted, national capital markets have been liberalized and international capital markets have exploded among the advanced industrial economies and beyond. As major players with significant stakes in the smooth operation of international capital markets, the United States and Europe have common interests in the emergence of a regulatory framework that enhances market stability, minimizes systemic risks, and allows for the efficient operation of markets. Yet despite the growth in cross-border capital movements, regulatory cooperation is at times plagued by differences in national approaches and preferences, difficulties coordinating rules where multiple regional or international organizations are involved, and regulators’ reluctance to cooperate fully with foreign jurisdictions.