The Internationalization of Law: The "Complex" Case of Bank Regulation

Abstract

International bank regulation has ramped to prominence over the past two decades, as nations and the global economy have lurched from one financial crisis to another. The current global financial crisis has brought unprecedented general attention to the subject. It is possible that we will witness fundamental changes in the way nations cooperate in the regulation of their financial institutions. Major reform efforts are underway. Yet international bank regulation has unusual characteristics and does not fit easily within the traditional framework of international law. The emerging system is also extremely fluid and complex-matching an extremely fluid and complex system of international finance. Interesting features have begun to emerge, suggesting that the time has come to recognize international banking regulation as an example of a complex adaptive system of the type that attracts the application of complexity theory. This paper outlines the features of the subject and the elements of complexity theory that seem helpful in elucidating the internationalization of international bank regulation.