Exhibit 1168 ยท Journal article
Inconsistent Regulators: Evidence from Banking
We find that regulators can implement identical rules inconsistently due to differences in their institutional design and incentives, and this behavior may adversely impact the effectiveness with which regulation is implemented.
Uses a legally set rotation that assigns federal and state bank supervisors to the same bank at fixed intervals. Federal supervisors downgrade ratings almost twice as often as state supervisors on the same banks, and state leniency is linked to later failures. The authors find no support for regulator self-interest, including revolving doors, as the reason for leniency. This is the cleanest published operator-versus-regime comparison: same bank, same rules, different regulator institution. Abstract read (Crossref).
- Source
- Agarwal, Lucca, Seru and Trebbi, Quarterly Journal of Economics 129(2):889-938
- Date
- May 2014
- Quoted from
- Abstract
- Grade
- Peer-reviewed
- Document
- https://doi.org/10.1093/qje/qju003
- Accessed
- 2026-11-10
- Cited by
- Findings citing this exhibit
- Note
- Standing note: robust design (rotation is exogenous). It is not a fee-funded versus appropriations-funded test, and it finds no revolving-door effect, so it cuts against the page's revolving-door ledger as a causal story. Cite it for institution design mattering and for the null on revolving doors together.