We evolve competitive measures of market discipline, and explore their associated ramifications for banking, by way of the effects of Basel II adoption. Using principal component analysis on the data of 706 banks from 34 countries, we generate measures that are better reflective of market discipline universally than any single variable that is popularly in use – e.g., subordinated debt activity. Interestingly, some of our measures are more suited to assessing market discipline in emerging economies than in developed economies and vice-versa, and some are suited to use across both groups of economies. Importantly, using impact assessment, we find that our constructs are indeed credible proxies for the Basel II envisaged market discipline; they are variously negatively related to Basel II adoption. Furthermore, bank performance, measured by profitability and stability, also exhibit significant responsiveness to the adoption of market discipline, with, for instance, less impact on developed economy banks’ profitability than on emerging economy banks’ profitability, and decline in loan risk in emerging economy banks versus the increase in loan risk in developed economy banks (which is interestingly mitigated by stable equity cushion and higher liquidity). These and other results of our paper provide useful policy guides for several stakeholders of the banking industry.

我们发展了市场纪律的竞争措施，并通过采用巴塞尔协议 II 的影响探索了它们对银行业的相关影响。通过对来自 34 个国家的 706 家银行的数据进行主成分分析，我们生成的衡量标准比任何普遍使用的单一变量（例如次级债务活动）更能普遍反映市场纪律。有趣的是，与发达经济体相比，我们的一些指标更适合评估新兴经济体的市场纪律，反之亦然，有些指标适用于这两个经济体组别。重要的是，使用影响评估，我们发现我们的构建确实是巴塞尔协议 II 设想的市场纪律的可靠代理；它们与巴塞尔协议 II 的采用呈负相关。此外，银行业绩，以盈利能力和稳定性衡量，也表现出对采用市场纪律的显着响应，例如对发达经济体银行盈利能力的影响小于对新兴经济体银行盈利能力的影响，新兴经济体银行的贷款风险下降与增加相比发达经济体银行的贷款风险（有趣的是，稳定的股权缓冲和更高的流动性减轻了这一风险）。我们论文的这些和其他结果为银行业的几个利益相关者提供了有用的政策指导。新兴经济体银行的贷款风险下降，而发达经济体银行的贷款风险增加（有趣的是，稳定的股权缓冲和更高的流动性缓解了这一点）。我们论文的这些和其他结果为银行业的几个利益相关者提供了有用的政策指导。新兴经济体银行的贷款风险下降，而发达经济体银行的贷款风险增加（有趣的是，稳定的股权缓冲和更高的流动性缓解了这一点）。我们论文的这些和其他结果为银行业的一些利益相关者提供了有用的政策指导。