Financial regulation is most effective when you have the confluence of a number of factors including an adequate legislative and regulatory framework; an effective supervisory system; including highly trained regulators; a regime of supporting and supportive institutions such as the accounting and auditing profession and support from an informed and vigilant investor community – or market discipline.
9 (March), pp. 3-39, www.ijcb.org/journal/ijcb13q1a1.pdf. Nakata, Taisuke, and Sebastian Schmidt (2016). “The Risk-Adjusted Monetary Policy Rule,” Finance and Economics Discussion Series 2016-061. Washington: Board of Governors of the Federal Reserve System, August, https://dx.doi.org/10.17016/FEDS.2016.061.