Western Nations Negotiate Economic Regulation

By Georgia Davis Conover

The United States and Europe are at odds over financial regulation in the wake of the worldwide economic downturn. European and U.S. regulators do agree that some common framework is necessary to keep corporations from simply moving operations to countries with little regulatory control over business. Regardless, the two sides do not agree on just what that means. One of the sticking points in the discussion between U.S. officials and their European counterparts is U.S.-based hedge funds. European regulators want to impose tougher restrictions on these investment groups but have offered to take a more relaxed position on market activities that are more strictly regulated in the United States. U.S. Treasury Secretary Timothy Geithner has opposed this plan arguing that differing regulations between countries could jeopardize the ability of U.S. corporations to conduct business efficiently.

While negotiators attempt to create some sort of plan for regulating the economy in Europe and the United States, economic geographers recognize that economies differ in different places, and that decisions made at the international level have variable impacts at the local level. Manuel Aalbers demonstrates these multi-scalar processes by pulling together various economic geography literatures in the context of mortgage lending. His work describes how various states, cities, neighborhoods and financial centers have been differentially impacted by the mortgage-lending crises and the down turn in credit lending. As Aalbers notes, his work is intended to help geographers and non-geographers alike understand the spatialization of the current economic downturn.