With presentations engaging both academic audiences and regulators, Professor Cristie Ford’s international book tour to promote her recently published book, Innovation and the State: Finance, Regulation, and Justice, is well underway.
On November 1, she met with the Board for the British Columbia Securities Commission and on November 20 she spoke at Le Centre de droit des affaires et du commerce international, Faculté de droit, Université de Montréal with several members of Quebec’s securities regulator, the Autorité des marchés financiers (AMF), in attendance. Other recent stops include Osgoode Hall Law School in Toronto, the University of Victoria Faculty of Law, and the American Bar Foundation.
In 2018 her book tour continues with the follow events planned:
- Ontario Securities Commission Board on January 29
- University of Pennsylvania Faculty of Law on January 30
- Columbia Law School on February 5
- New York University Law School on February 6
- Berkeley Law School, UC Berkeley on March 13
- Law & Society Conference (US) in Toronto, Author-Meets-Reader Panel on June 7
- European Consortium for Political Research (ECPR) Standing Group on Regulatory Governance Biennial Meeting in Lausanne, Switzerland, Book Launch Panel on July 5
On March 15 the official hometown book launch hosted by the Centre for Business Law at the Allard School of Law will be held. Stay tuned for more information!
To learn more about Ford’s book, read the Q&A below which originally ran in the 2017 Allard Alumni Magazine.
Innovation and the State: Finance, Regulation, and Justice: A Q&A with Associate Professor Cristie Ford on her new book
Spurred on in part by the 2008 financial crisis and, in its aftermath, the strong criticism of the regulatory regimes that seemingly allowed it, Professor Cristie Ford addresses the complex interactions of regulation and innovation in her new book, Innovation and the State: Finance, Regulation, and Justice (Cambridge University Press, 2017).
Eschewing a simplistic championing of either one or the other, Ford argues that innovation interacts with regulation in specific and identifiable ways, and often with significant consequences, using several case studies to show how we can learn from past experiences to navigate this often-ignored territory.
Since the financial crisis, it seems more people are interested in, but also skeptical of, financial regulation. How does your book address this interest and concern?
The financial crisis and the response to it are very complicated phenomena, which implicate not just regulation but politics, economics, public policy, power and influence, globalization, and history. I argue that we can make real progress—seeing problems in advance, seeing them more clearly, making sure that our regulatory prescriptions match our social priorities—if we clear away some of that and focus on the phenomenon of innovation. Innovation is not by definition beneficial. But it is, almost by definition, a regulatory challenge. It is a technical challenge, and also a challenge to the normative goals and social priorities that regulation is supposed to be advancing in the first place. Putting innovation at the centre of regulatory analysis makes us realize how little we understand it, and throws up a whole range of different options for responding to it going forward.
What are some regulations from recent history that have been undermined by not foreseeing innovation?
There are numerous, but my book considers four in particular: the traditional, bright-line accounting rules in the Enron era in the United States; the asset-backed commercial paper regime in Canada, which was essentially market-based; the Basel II capital adequacy regime, which incorporated private risk assessment tools into transnational financial regulation; and the Volcker Rule in the US, which brings home the limits of rulemaking as a participatory mechanism when dealing with innovative topics. In each case regulation failed to perform as intended, largely because it did not take seriously the swamping effect that private innovation would have on regulatory structures designed to channel it.
One of my goals is to shed light on some of the specific ways in which innovation can undermine our regulatory assumptions and structures, in subtle, hard-to-see, but hugely consequential ways. Recognizing innovation as a fundamental, central challenge to regulation itself is essential to developing more robust and forward-looking regulation.
Is innovation, from a regulatory perspective, always a negative challenge?
This is not an anti-innovation book, but it does argue that we should understand what we’re talking about with a bit more granularity. Innovation is not monolithic, but nor can we reliably identify “good” innovation and “bad” innovation in advance. A number of financial innovations were very socially useful for a while, before they became vehicles for profiteering, avoiding regulation, and spreading risk and damage to the public at large. If we want to regulate finance (and many other things) effectively, we need to reorient our strategies based on a clearer view of what innovation actually looks like in different environments, and what kinds of risks it generates for regulation, for society, and for our values.