Quando o regulador passa a regulado — e ninguém se incomoda

• Nuno Garoupa, Caixa Geral de Depósitos:

‘Quite surprisingly, the appointment of a new administration for the state-owned banking corporation CGD has emerged as priority. CGD operates in a highly regulated industry. The Bank of Portugal is the regulator. CGD is the largest bank in Portugal. The government selects the one who regulates to manage the one who is regulated. Economists call this the revolving door problem in regulation. Hundreds of papers in the economics of regulation and public choice address the perverse effects of the revolving door behavior in politics. Nobody in Portugal, but literally nobody seems to be worried about it. Remarkable! More remarkable when there have been accusations of regulatory failure against the Bank of Portugal (due to BPN and BPP scandals a couple of years ago).’

Paulo F.