-
Details
- No other work focuses comprehensively on the economic, behavioral, and legal aspects of Truth in Lending or other federal financial consumer protection measures. Other sources are either solely legal in their orientation (for example, case books) or are statements of advocates of one regulatory position or another (for example, testimony and lobbying materials).
- The entire book concerns an ongoing public policy debate about the efficacy of financial disclosures as consumer protections. This debate began as long as 1960 with Congressional introduction of the original Consumer Credit Labeling Bill, now evolved into the massive federal financial disclosure regimes. Congress has amended Truth in Lending twenty five times since passage in 1968 and no year goes by without discussion of further amendments.
This book is a guide to the purposes, strengths, and weaknesses of disclosures as consumer protections in financial transactions such as loans, deposits, and consumer leases. It focuses on the federal Truth in Lending Act but also covers a variety of other federal disclosure statutes designed to protect consumers in their financial relationships. It comes at a time when federal financial consumer protection policy in the financial area is again a matter of intense public scrutiny and debate.
Because of the importance of public policy issues surrounding use of disclosures as consumer protections, the intended audience includes anyone interested in these issues, not simply specialists who spend their time focused on them. For this reason, the work avoids academic jargon and the mathematics that is the modern language of economics. It also examines the psychological, sociological, historical, and especially legal traditions that go into fully understanding what has led to the demand for better disclosures for consumers and to what they have become today. Despite a need to outline and review prior difficulties with disclosure laws, the book remains optimistic that disclosures will continue to be an important means of consumer protection and that future reforms can improve their effectiveness and lower their regulatory costs and burden.
Readership: The public policy community, especially in Washington; the academic community in economics, finance, marketing, and law; the financial services industry including banks and other financial institutions; students in law, public policy, and consumer protection; lay members of the public interested in public policy debates in the financial or consumer protection areas.
-
Thomas Durkin has specialized in the economics and regulation of consumer financial services, in the federal government as Senior Economist at the Federal Reserve Board, in the academic area as Associate Professor of Finance at the Pennsylvania State University, and in the private sector as Chief Economist of the American Financial Services Association.
Gregory Elliehausen has also specialized in the economics and regulation of consumer financial services, in the federal government as Economist at the Board of Governors of the Federal Reserve System for more than twenty years and in the academic sector as Senior Research Scholar at Georgetown University and the George Washington University.
-
"Information is crucial to the effective operation of consumer financial markets. Durkin and Elliehausen have provided a valuable and comprehensive analysis of an important but often neglected topic, namely, required disclosures from financial services firms. Their analysis will play a significant role in the ongoing debate about making those disclosures less legalistic and more useful to consumers."--Randall S. Kroszner, Norman R. Bobins Professor of Economics, The University of Chicago
"This is a very comprehensive and insightful text by respected and experienced regulatory economists on the proper economic and behavioral goals that should inform the regulatory implementation and interpretation of the consumer disclosure mandates of the Truth in Lending Act. Their extensive analysis convincingly suggests that to avoid an overly complex and costly regulatory regime, Congress, and the regulators, should focus on the comparison of the cost of credit, including a better designation of finance charges, as the primary disclosure goal of TILA, and should avoid pursuing or maintaining numerous collateral 'full disclosure' goals, including "behavioral" goals which may serve some other unrelated perceived social objective. Consider this required reading for all legislators, regulators, bankers and their advisors involved with TILA oversight, implementation or compliance."-- Neal L. Petersen, Attorney at Law, Former General Counsel, Federal Reserve Board
"Scholars and policymakers have long needed a comprehensive treatment of the history, theory, and effectiveness of the Truth in Lending Act. And no one is better qualified to give us that treatment than respected scholars and veteran Federal Reserve economists, Thomas Durkin and Gregory Elliehausen. Durkin and Elliehausen tell the story of the triumphs and tragedies of the Truth in Lending Act, as well as a road to reform. In light of the recent financial crisis and the regulatory reforms that have followed in its wake, no book could be more timely and important in charting a path forward. This will be the standard work on Truth in Lending for years to come." --Todd J. Zywicki, George Mason University Foundation Professor of Law, George Mason University School of Law and Senior Scholar, Mercatus Center
