Date of Award

2017

Document Type

Thesis

Degree Name

Bachelors

Department

Social Sciences

First Advisor

Yu, Sherry

Area of Concentration

Economics

Abstract

In 2008, America experienced the worst economic crash since the Great Depression. The crisis was primarily due to the growth of systemic risk in the financial industry, with multi-billion dollar bank holding companies making extensive profits by over-leveraging and over-investing in mortgage-backed securities. When the housing bubble burst, the entire economy collapsed. The US Government responded in 2010 with the Dodd-Frank Wall Street Reform and Consumer Protection Act which sought to increase regulation, accountability, and transparency within the financial industry. However, such broad regulations may have a severely negative impact on economic recovery by introducing heavy compliance costs and limiting sources of revenues. This thesis conducts a cost-benefit analysis on the results of the Dodd-Frank Act to determine the effect on the general financial industry. Further, we analyze the specific regulatory impact on the small banking industry that may have suffered unfair and disproportionate costs as a result of the actions of the largest banking institutions.

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