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Understanding the LIBOR scandal: the historical, the ethical, and the technological

Author

Listed:
  • Xing Huan

    (EDHEC Business School)

  • Gary John Previts

    (Case Western Reserve University)

  • Antonio Parbonetti

    (University of Padova)

Abstract

This article examines the conception of banking regulation through the lens of the LIBOR scandal. The narrative of the scandal addresses the debate surrounding the public versus private view of banking regulation. Employing an analytical framework developed through reassembling prevailing regulation theories that is contextualized to the banking industry, we analyze the historical, ethical, and technological aspects of the LIBOR scandal and subsequent reform. We argue that the narrative of the LIBOR scandal represents a typical regulatory capture in the private interest view of regulation. However, the benchmark reform appears to concur with the recent paradigm shift toward the public interest approach to banking regulation that involves more intrusive and detailed supervision with a focus on structural reforms.

Suggested Citation

  • Xing Huan & Gary John Previts & Antonio Parbonetti, 2023. "Understanding the LIBOR scandal: the historical, the ethical, and the technological," Journal of Banking Regulation, Palgrave Macmillan, vol. 24(4), pages 403-419, December.
    • Handle: RePEc:pal:jbkreg:v:24:y:2023:i:4:d:10.1057_s41261-022-00205-4
    DOI: 10.1057/s41261-022-00205-4
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    References listed on IDEAS

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    1. J. G. L'opez-Salas & S. P'erez-Rodr'iguez & C. V'azquez, 2024. "PDEs for pricing interest rate derivatives under the new generalized Forward Market Model (FMM)," Papers 2408.02289, arXiv.org.

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