One day we'll all invest this way: Regulating online investment. 2005 - 2007
Chief Investigators:
- Professor Dimity Kingsfor-Smith, Faculty of Law, University of New South Wales.
- Dr Kirsty Williamson, Director, ITNR, Monash University/Charles Sturt University.
- Stephen Bottomley, Associate Dean & Head of School, Professor of Commercial Law, Australian National University.
Funder: Australian Research Council Discovery grant, $285,000 over 3 years, 2005-2007.
Project Overview
One day, we'll all invest this way! But can we afford it? Online investing has brought huge reductions in transaction costs of investing. However, there are good reasons for caution. This project will analyse the limitations of online investing regulation using legal and empirical approaches. Through an international collaboration it will introduce expertises in implications of investor psychology for online investing and in the comparative regulation of online investing. This is unique in the field. It will produce practical recommendations and legal theory for the future regulation of online investment. It will increase the safety and competitiveness of investing, bringing overseas investors to Australia through the Internet.
Aims of the Project
- To analyse the limitations of existing legal regulation in providing protection for online investors;
- To understand whether there is a need for regulation by identifying and analysing the content of investment sites, whether licensed or not eg chat rooms, portals;
- To explore the needs, experiences, knowledge and understandings, including in relation to information and advice, of online investors;
- Linked to the above aim, to explore the attitudes, practices, and understandings of sponsors of online investment sites;
- To use a comparative approach to examine regulatory techniques adopted for online investing in overseas markets; and
- To further contemporary regulatory theory and make practical recommendations for regulatory reform.
Research Plan
A‘mixed methods' approach will be used for this project. The aims of the empirical analysis are:
(1) to use website searching software to understand the need for regulation by identifying and analysing the content of licensed online trading sites and others offering online investment information, such as portals and chat rooms;
(2) to collect, through an online survey, basic information about the kinds of people involved in this form of investment, their types of involvement, and their use of information and advice; and
(3) to use individual in-depth interviews and focus groups to identify the attitudes, practices, and understandings of sponsors of online investment sites, and to explore the needs, experiences, knowledge and understandings of investors.
Current Status
The first year of the project saw the setting up of the project website and a database to contain all the literature which will provide the background to the fieldwork and future publications. Link to the project website
A major task of the first year was the legal analysis: of existing legal regulation; to identify issues for empirical and comparative investigation; to identify areas for law reform consideration; and to provide further theoretical work on decentered approaches.
The online survey has been completed, results analysed and soon to be distributed to respondents.
The following are the project publications to date, including one resulting from the pilot project which underpinned the ARC application.
Kingsford Smith, D. & Williamson, K. (2004) ‘How do online investors seek information? Theory, method and preliminary findings’. Journal of Information, Law and Technology (JILT), Issue 2. http://www2.warwick.ac.uk/fac/soc/law/elj/jilt/2004_2/kingsford-smithandwilliamson/
Williamson, K., (2006) ‘Research in constructivist frameworks using ethnographic techniques’, Library Trends.
Kingsford Smith, D (2006) The Same Yet Different: Australian and U.S. Online Investing Regulation, University of Toledo Law Review Volume 37 no. 1.
Kingsford Smith, D (2006) Importing the E-World into Canadian Securities Regulation, in Halpern and Puri (eds) ‘Modernising Canadian Securities Legislation’ to be published by UTP later in the year.
Perth Seminar 2007
Kirsty Williamson held a seminar at the State Library of WA in April 2007 which included a preview of this research into whether there is a need for legal regulation of online investment.
The powerpoint presentation can be viewed here
|
