Compliance-driven investments in technology—or “RegTech”—are growing rapidly. To understand the effects on the financial sector, we study firms’ responses to new internal control requirements. Affected firms make significant investments in ERP and hardware. These expenditures then enable complementary investments that are leveraged for noncompliance purposes, leading to modest savings from avoided customer complaints and misconduct. IT budgets rise and profits fall, especially at small firms, and acquisition activity and market concentration increase. Our results illustrate how regulation can directly and indirectly affect technology adoption, which in turn affects noncompliance functions and market structure.

中文翻译：

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RegTech：技术驱动的合规性及其对盈利能力、运营和市场结构的影响

合规驱动的技术投资（或“RegTech”）正在迅速增长。为了了解对金融部门的影响，我们研究了企业对新的内部控制要求的反应。受影响的公司在 ERP 和硬件方面进行了大量投资。然后，这些支出可以实现补充投资，用于不合规目的，从而避免客户投诉和不当行为，从而节省一定的成本。 IT 预算增加，利润下降，尤其是小公司，而收购活动和市场集中度增加。我们的结果说明了监管如何直接和间接影响技术的采用，进而影响违规功能和市场结构。