The Economic Foundations of Anti-Money laundering Regulation

Authors

  • Paulo Roberto Amorim Loureiro University of Brasília image/svg+xml
  • Ricardo A. Araújo
  • Tito B. S. Moreira

DOI:

https://doi.org/10.31501/ealr.v6i2.6093

Keywords:

diabetes, exercício, cardiorrespiratório, agudo.

Abstract

In this paper the foundations of anti-money laundering regulation are analyzed from an economic viewpoint. The analysis departs from the view that money laundering is a polluting element in financial systems produced by the regular activity of financial institutions. In a latu sensu view it can be viewed as a negative externality that has to be dealt with. The paper shows that the current anti-money laundering regulation is based on a Pigouvian approach although it is known that a Coasian analysis is theoretically superior to deal with law and economic issues.  This may help to explain the difficulties that the anti-money laundering regulations are facing to be efficiently applied worldwide. However, the Coasian approach cannot be implemented due to some characteristics of the money laundering. First, it is a derived offence in which is difficult to establish who is the victim. This fact makes almost impossible the creation of a market in which the victims and would negotiate the property rights. Hence, the paper acknowledges that a Pigovian approach although plagged by some difficulties is shown to be the best practice to cope with prevention of money laundering.

Author Biography

  • Paulo Roberto Amorim Loureiro, University of Brasília

    University of Brasilia – UnB

    Faculty of Economics, Business and Accounting – (FACE)

    Department of Economics – (ECO)

    Paulo R. A. Loureiro

    Associate Professor of Economics at University of Brasilia – UnB

    and Research Associate of the Brazilian Council of Science and Technology (CNPq).

    Research interests:

    Applied Econometrics; Labor Economics and Economics of Crime and Violence.

    Email: pauloloureiro@unb.br

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Published

2016-02-22

Issue

Vol. 6 No. 2 (2015): Economic Analysis of Law Review

Section

Papers

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