Convergence, Coordination and Collusion in Securities Regulation: The Latin American Integrated Market

Abstract

This chapter describes how stock exchange integration under the Latin American Integrated Market (MILA) may help overcome some of the political economy challenges to capital market development in the region. First, the creation of MILA may lead to regulatory convergence along the lines of Chile's higher disclosure and governance standards. Second, the agreements that underpin the existence of MILA could facilitate the regional coordination of enforcement policies. Third, the overarching structure of the integrated market could pave the way for the reallocation of policymaking and enforcement authority from the local to the regional level. In all three cases, the onset of MILA could insulate Latin American policymakers from the pressure of local interest groups, thereby neutralizing opposition to much-needed capital market reforms.