This highly readable book is the outgrowth of a Ph.D. dissertation in political science. In a clear thesis, Sobel states that the dramatic deregulation of financial markets in the United States, Britain, and Japan during the 1970s and 1980s was driven not, as is commonly supposed, by growing international financial integration and competition, but by domestic pressure. Financial markets were severely segmented in all three countries. The advance of technology and certain triggering events, especially financial scandals in Britain and Japan, made financial liberalization politically possible.
Sobel compiles a cornucopia of information on securities markets and government policy. The focus is equities and rather neglects foreign exchange and derivatives. The thesis draws a somewhat artificial dichotomy between domestic and international impetus to change and probably understates the extent that international competition wore down domestic opposition to change. The book itself observes that the United States sets the standards in financial developments that affect other countries. But it reminds us that, in the end, all politics is local.