Market fragmentation, technical complexity and information asymmetry drive the regulation of financial markets. We examine how government bodies develop and implement policy mandates for regulatory oversight of automated trading. Simon's theory of bounded rationality guides the research enquiry on regulatory decision choices and outcomes. Primary and secondary data reveal four phases of evolutionary technological change in financial markets. Each phase presents financial regulators with unprecedented policy challenges in preventing systemic and firm-specific risk in financial markets. Findings show regulatory mandates eschew ex-ante for ex-post decision criteria, as constrained optimization results in regulators’ seeking satisfactory solutions to mitigate financial market risk.

市场碎片化、技术复杂性和信息不对称推动了金融市场的监管。我们研究政府机构如何制定和实施自动化交易监管的政策授权。西蒙的有限理性理论指导了对监管决策选择和结果的研究。一手和二手数据揭示了金融市场进化技术变革的四个阶段。每个阶段都向金融监管机构提出了前所未有的政策挑战，以防止金融市场出现系统性和公司特定风险。调查结果表明，监管要求在事后决策标准上避免事前，因为受约束的优化导致监管机构寻求令人满意的解决方案来降低金融市场风险。