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Working Paper
Artificial Intelligence Innovation by Financial Innovators: Evidence from US Patents
This paper examines the evolution of artificial intelligence (AI) patent rates (i.e., the number of AI patents/number of firms of the same type) and concentration metrics (i.e., the Herfindahl-Hirschman Index (HHI) and Gini coefficient) among financial market participants from 2000 to 2020. It documents the historical trajectories of AI innovation for regulated banking entities and less-regulated firms, revealing that nonfinancial companies exhibit the highest baseline AI patent rate, while banks show the highest growth in AI patent rate over time. Banks have the highest HHI, and nonfinancial ...
Working Paper
A Brief History of the U.S. Regulatory Perimeter
This paper provides a brief history of the U.S. financial regulatory perimeter, a legal cordon comprised of “positive†and “negative†restrictions on the conduct of banking organizations. Today’s regulatory perimeter faces a wide range of challenges, from disaggregation, to new commercial entrants, to new varieties of charters (and new uses of legacy charters). We situate these challenges in the longer history of American banking, identifying a pattern in debates about the nature, shape, and position of the perimeter: outside-in pressure, inside-out pressure, and ...