Is Wall Street more corrupt than anywhere else?

How corrupt is Wall Street compared to other industries? Well, Kevin Drum points out the obvious: The newspapers are constantly filled with investigations into banker malfeasance.

But does that really mean that Wall Street is especially awful and corrupt? Most other industries do not have six or seven different regulatory bodies overseeing their operations. Nor do U.S. attorneys - or New York state district attorneys - make star political careers by prosecuting top manufacturers of lawn and patio furniture. Of course Wall Street is constantly under investigation. What else are all those regulators and government prosecutors supposed to do with their time?

I’m not actually suggesting that Wall Street is a bastion of honor and restraint. There’s an enormous amount of money sloshing around the financial industry; given that, it would be kind of surprising if there wasn’t a significant amount of malfeasance. However, it is also the most heavily regulated business in America, except maybe the nuclear-power industry; big financial institutions regularly have representatives from various regulatory bodies camped in their offices for extended periods of time. Given that, it would be kind of surprising if they managed to break more rules than your typical small businessman in a cash business.

Anyway, whatever the actual level of malfeasance in the industry, you can’t measure it by the number of investigations. The number of investigations is more likely to be a function of the number of investigators than the amount of wrongdoing available to investigate. And with the nation’s beady glare fixed on Wall Street, the number of investigators is large indeed.

by Megan McArdle, Bloomberg View columnist