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The Government of MarketsThe Grain Futures Act of 1922 and the Dominance of the CBOT

The Government of Markets: The Grain Futures Act of 1922 and the Dominance of the CBOT [Congress passed the Grain Futures Act in 1922 soon after the Crisis of 1921, when wheat prices fell more than half. Contrary to the accepted view that the regulation was a failed attempt to control the markets, the legislation was almost fully ‘captured’ by the Chicago Board of Trade (CBOT). The Chicago futures markets benefited substantially from the legislation, gaining legitimacy in the Courts and in Congress, while cementing a protected monopoly that would not be broken until late in the twentieth century. On the other hand, the US government gained the right to obtain hitherto unavailable information about the markets, publish such data and perform in-depth analysis for use by the regulators, Congress and the futures market participants, themselves.] http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png

The Government of MarketsThe Grain Futures Act of 1922 and the Dominance of the CBOT

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References (24)

Publisher
Springer International Publishing
Copyright
© The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer Nature Switzerland AG 2018
ISBN
978-3-319-93183-8
Pages
87 –148
DOI
10.1007/978-3-319-93184-5_3
Publisher site
See Chapter on Publisher Site

Abstract

[Congress passed the Grain Futures Act in 1922 soon after the Crisis of 1921, when wheat prices fell more than half. Contrary to the accepted view that the regulation was a failed attempt to control the markets, the legislation was almost fully ‘captured’ by the Chicago Board of Trade (CBOT). The Chicago futures markets benefited substantially from the legislation, gaining legitimacy in the Courts and in Congress, while cementing a protected monopoly that would not be broken until late in the twentieth century. On the other hand, the US government gained the right to obtain hitherto unavailable information about the markets, publish such data and perform in-depth analysis for use by the regulators, Congress and the futures market participants, themselves.]

Published: Dec 22, 2018

Keywords: Grain Futures Act; Market regulation; Capture; Public interest

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