Compliance and International Soft Law: Why Do Countries Implement the Basle Accord?

Posted: 6 Nov 2002

Abstract

This article presents empirical research into why countries comply with international soft law. I examine economic and institutional determinants of implementation of the 1988 Basle Accord of capital adequacy from a dataset of 107 countries.

Market forces partially explain national decisions to implement the Basle Accord, lending support to the interpretation of international law as a reputational mechanism.

One of the most striking and robust findings is the consistent positive effect of democratic systems on implementation, lending credence to democratic legalist theories of international law.

Some evidence suggests that divided government and corruption are both negatively associated with soft law compliance. The findings also refute the explanation that countries 'learned' from prior banking crises, and support the contrary proposition that countries that experienced banking crises are in fact less likely to comply with international harmonization of banking regulation.

Keywords: International law, political economy, treaties, political science, government, banking, harmonization

JEL Classification: K33, F33, F42

Suggested Citation

Ho, Daniel E., Compliance and International Soft Law: Why Do Countries Implement the Basle Accord?. Available at SSRN: https://ssrn.com/abstract=329942

Daniel E. Ho (Contact Author)

Stanford Law School ( email )

559 Nathan Abbott Way
Stanford, CA 94305-8610
United States
650-723-9560 (Phone)

HOME PAGE: http://dho.stanford.edu

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
1,394
PlumX Metrics