Updated June 2013.
A recent paper with Hector Perez and Joshua Slive, also from the Bank of Canada. We study how CCP membership rules and risk controls affect the competitive structure of an OTC market. These constraints reduce systemic risk (i.e., CCP default risk) but they also increase the market power of its members. We find that risk controls can serve as an anticompetitive instrument, allowing members to coordinate around a more profitable outcome at the expense of non-members. You can find the paper here : Competition and Strategic Control of a Central Counterparty