Chapter 12: Inclusion: Universal Access, Consumer and Workers’ Protection
Jörg Huffschmid INTRODUCTION 12.1 Experience has shown (see Chapter 10) that the potential benefits of large integrated financial markets do not automatically occur and that where they do occur they often do not reach society as a whole but only specific privileged groups. Enlargement of European markets for retail finance could lead to selective supply and cherry-picking of attractive crosscountry business opportunities and the neglect of those areas which were – although less profitable – previously covered in a domestic framework. Opening up of markets could also trigger more concentration and centralization to cope with more intense competition and to establish stronger market positions of national champions, which could exploit such positions against weak and vulnerable customers such as individuals and small businesses and farmers. Full liberalization of capital markets will also facilitate capital flows to the most profitable locations without concern for the consequences of job losses, deterioration of work conditions or of closures and relocations for the workers, communities and regions concerned. For all these reasons, political measures are needed to ensure comprehensive instead of selective positive effects of financial integration. Financial institutions and their associations on the national and European level often argue that instead of legislative measures (the implementation of which requires a great amount of bureaucracy) selfregulation should be preferred, which would lead to simpler and more efficient solutions for everyone. But where self-regulation includes all the stakeholders, including consumers, communities and workers, it is often very general and inefficient. The kind of self-regulation which can...
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