Word.ws English Dictionary

market discipline

market discipline noun: the forces in a free market which tend to control and limit the riskiness of a financial institution's investment and lending activities, such as the concern of depositors for the safety of their deposits and the concern of bank investors for the safety and soundness of their institutions.

Noun

market discipline (uncountable)

  1. The forces in a free market which tend to control and limit the riskiness of a financial institution's investment and lending activities, such as the concern of depositors for the safety of their deposits and the concern of bank investors for the safety and soundness of their institutions.
    • Handing financial regulation back to ‘market discipline’ will nullify the progress that has been made to create a system of international regulation.2002 June 8, John Eatwell, “Basel II: the regulators strike back”, in The Observer, →ISSN
    • A “bail-in” process for bank resolution is a potentially powerful “third option” that confronts this problem head-on. […] If done correctly it should strengthen market discipline on banks and reduce the potential for systemic risk.2010 January 28, “From bail-out to bail-in”, in The Economist, →ISSN

Examples of market discipline in a sentence

  • The FSA believed in ‘market discipline’ and failed to get its message across.2011 May 19, Jill Treanor, “Spotlight falls on City watchdog Sants”, in The Guardian, →ISSN:
  • Suppose that Greece had never adopted the Euro and the terms of its external borrowing had remained subject to “market discipline”, as it had been in the 1990s.2011 July 4, “Was it worth it?”, in The Economist, →ISSN:

Questions about market discipline

What does market discipline mean?
Market discipline means the forces in a free market which tend to control and limit the riskiness of a financial institution's investment and lending activities, such as the concern of depositors for the safety of their deposits and the concern of bank investors for the safety and soundness of their institutions.
How do you use market discipline in a sentence?
The FSA believed in ‘market discipline’ and failed to get its message across.
What part of speech is market discipline?
Market discipline is a noun.

Words near market discipline in the dictionary

  1. market cross
  2. market crosses
  3. market day
  4. market days
  5. Market Deeping
  6. market discipline
  7. Market Drayton
  8. market economies
  9. market economy
  10. market equilibrium
  11. market equilibriums

Source and license

Adapted from Wiktionary: market discipline (page history and authors). Text available under the Creative Commons Attribution-ShareAlike 4.0 license. Word.ws reformatted the entry and added links. Wiktionary data of 2026-09-02.

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