Publication:
Financial Development : Structure and Dynamics

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dc.contributor.authorFeyen, Erik
dc.contributor.authorde la Torre, Augusto
dc.contributor.authorIze, Alain
dc.date.accessioned2012-03-19T18:05:42Z
dc.date.available2012-03-19T18:05:42Z
dc.date.issued2011-10-01
dc.description.abstractThis paper analyzes the bright and dark sides of the financial development process through the lenses of the four fundamental frictions to which agents are exposed -- information asymmetry, enforcement, collective action, and collective cognition. Financial development is shaped by the efforts of market participants to grind down or circumvent these frictions, a process further spurred by financial innovation and scale and network effects. The analysis leads to broad predictions regarding the sequencing and convexity of the dynamic paths for a battery of financial development indicators. The method used also yields a robust way to benchmark the financial development paths followed by individual countries or regions. The paper explores the reasons for path deviations and gaps relative to the benchmark. Demand-related effects (past output growth), financial crashes, and supply-related effects (the quality of the enabling environment) all play an important role. Informational frictions are easier to overcome than contractual frictions, not least because of the transferability of financial innovation across borders.en
dc.identifierhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111024134059
dc.identifier.doi10.1596/1813-9450-5854
dc.identifier.urihttps://hdl.handle.net/10986/3620
dc.languageEnglish
dc.relation.ispartofseriesPolicy Research working paper ; no. WPS 5854
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectACCOUNTING
dc.subjectADVERSE SELECTION
dc.subjectARBITRAGE
dc.subjectASSET MANAGERS
dc.subjectASSETS RATIO
dc.subjectASYMMETRIC INFORMATION
dc.subjectBANK ASSETS
dc.subjectBANK BRANCH
dc.subjectBANK CREDIT
dc.subjectBANK DEBT
dc.subjectBANK DEPOSIT
dc.subjectBANK DEPOSITS
dc.subjectBANK MARGINS
dc.subjectBANK POLICY
dc.subjectBENCHMARK
dc.subjectBENCHMARKING
dc.subjectBENCHMARKS
dc.subjectBILLS OF EXCHANGE
dc.subjectBORROWER
dc.subjectBOUNDED RATIONALITY
dc.subjectBROKERS
dc.subjectCAPITAL ADEQUACY
dc.subjectCAPITAL MARKETS
dc.subjectCAPITALIZATION
dc.subjectCENTRAL BANK
dc.subjectCENTRAL BANKS
dc.subjectCHECKING ACCOUNTS
dc.subjectCOLLECTIVE ACTION
dc.subjectCOMMERCIAL BANKS
dc.subjectCONSUMERS
dc.subjectCONTRACT ENFORCEMENT
dc.subjectCOORDINATION FAILURES
dc.subjectCORPORATE BONDS
dc.subjectCORPORATE GOVERNANCE
dc.subjectCREDIT BUREAUS
dc.subjectCREDIT CARD
dc.subjectCREDIT DEFAULT
dc.subjectCREDIT DEFAULT SWAPS
dc.subjectCREDIT GROWTH
dc.subjectCREDIT INFORMATION
dc.subjectCREDIT MARKETS
dc.subjectCREDITOR
dc.subjectCREDITOR RIGHTS
dc.subjectCURRENCY MISMATCHES
dc.subjectCUSTODY
dc.subjectDEBT SECURITIES
dc.subjectDEFAULT RISK
dc.subjectDEPOSIT
dc.subjectDEPOSIT SERVICES
dc.subjectDEPOSITS
dc.subjectDEREGULATION
dc.subjectDERIVATIVE
dc.subjectDERIVATIVE MARKETS
dc.subjectDERIVATIVE PRODUCTS
dc.subjectDERIVATIVES
dc.subjectDEVELOPING COUNTRIES
dc.subjectDEVELOPMENT PATHS
dc.subjectDEVELOPMENT POLICIES
dc.subjectDEVELOPMENT POLICY
dc.subjectDISCLOSURE STANDARDS
dc.subjectDISEQUILIBRIUM
dc.subjectDIVERSIFICATION BENEFITS
dc.subjectDOMESTIC CURRENCY
dc.subjectDOMESTIC DEBT
dc.subjectDOMESTIC EQUITIES
dc.subjectDOMESTIC EQUITY
dc.subjectECONOMETRIC ANALYSIS
dc.subjectECONOMIC DEVELOPMENT
dc.subjectECONOMIC HISTORY
dc.subjectECONOMIC PERFORMANCE
dc.subjectECONOMIC POLICIES
dc.subjectECONOMIC RENT
dc.subjectECONOMIC RESEARCH
dc.subjectEMERGING ECONOMIES
dc.subjectEMERGING ECONOMY
dc.subjectENABLING ENVIRONMENT
dc.subjectEQUITY MARKET
dc.subjectEQUITY MARKET CAPITALIZATION
dc.subjectEQUITY MARKETS
dc.subjectEQUITY SECURITIES
dc.subjectEXPECTED VALUES
dc.subjectEXPORTER
dc.subjectEXPOSURE
dc.subjectEXTERNAL DEBT
dc.subjectEXTERNAL FINANCE
dc.subjectFEE INCOME
dc.subjectFINANCIAL CONTRACT
dc.subjectFINANCIAL CONTRACTS
dc.subjectFINANCIAL CRISES
dc.subjectFINANCIAL CRISIS
dc.subjectFINANCIAL DEVELOPMENT
dc.subjectFINANCIAL FRAGILITY
dc.subjectFINANCIAL HISTORY
dc.subjectFINANCIAL INFRASTRUCTURE
dc.subjectFINANCIAL INNOVATION
dc.subjectFINANCIAL INSTABILITY
dc.subjectFINANCIAL INSTITUTIONS
dc.subjectFINANCIAL MARKETS
dc.subjectFINANCIAL SECTOR
dc.subjectFINANCIAL SERVICE
dc.subjectFINANCIAL SERVICE PROVIDERS
dc.subjectFINANCIAL STABILITY
dc.subjectFINANCIAL STRUCTURE
dc.subjectFINANCIAL SUSTAINABILITY
dc.subjectFINANCIAL SYSTEM
dc.subjectFINANCIAL SYSTEMS
dc.subjectFINANCIAL TRANSACTIONS
dc.subjectFINANCIAL VOLATILITY
dc.subjectFIXED COSTS
dc.subjectFOREIGN CURRENCY
dc.subjectFREE RIDING PROBLEMS
dc.subjectFUND MANAGERS
dc.subjectGDP
dc.subjectGDP PER CAPITA
dc.subjectGLOBALIZATION
dc.subjectGOVERNMENT BOND
dc.subjectGOVERNMENT BOND MARKET
dc.subjectGOVERNMENT BORROWING
dc.subjectGOVERNMENT DEBT
dc.subjectGOVERNMENT DEBT MARKETS
dc.subjectGOVERNMENT GUARANTEES
dc.subjectHEDGE FUNDS
dc.subjectHEDGES
dc.subjectINCOME GROWTH
dc.subjectINCOME LEVEL
dc.subjectINCOME LEVELS
dc.subjectINCREASING RETURNS
dc.subjectINCREASING RETURNS TO SCALE
dc.subjectINFORMATION ASYMMETRY
dc.subjectINSTITUTIONAL INVESTORS
dc.subjectINSURANCE
dc.subjectINSURANCE COMPANIES
dc.subjectINSURANCE COMPANY
dc.subjectINSURANCE PREMIUM
dc.subjectINSURANCE PREMIUMS
dc.subjectINTEREST INCOME
dc.subjectINTERNATIONAL BANK
dc.subjectINTERNATIONAL FINANCE
dc.subjectINVESTING
dc.subjectINVESTMENT BANKS
dc.subjectLACK OF COLLATERAL
dc.subjectLEGAL RIGHTS
dc.subjectLIFE INSURANCE
dc.subjectLIMITED LIABILITY
dc.subjectLIQUID ASSETS
dc.subjectLIQUIDITY
dc.subjectLOANABLE FUNDS
dc.subjectMACROECONOMIC POLICY
dc.subjectMACROECONOMICS
dc.subjectMARGINAL BENEFITS
dc.subjectMARGINAL COSTS
dc.subjectMARKET ANALYSTS
dc.subjectMARKET DEBT
dc.subjectMARKET FAILURES
dc.subjectMARKET INSTRUMENTS
dc.subjectMARKET LIQUIDITY
dc.subjectMARKET MECHANISM
dc.subjectMARKET PARTICIPANTS
dc.subjectMARKET RETURN
dc.subjectMARKET SIZE
dc.subjectMARKET TURNOVER
dc.subjectMARKETABLE ASSETS
dc.subjectMIDDLE INCOME COUNTRIES
dc.subjectMONETARY POLICY
dc.subjectMORAL HAZARD
dc.subjectMORTGAGE
dc.subjectMUTUAL FUND
dc.subjectMUTUAL FUND ASSETS
dc.subjectMUTUAL FUNDS
dc.subjectNEGATIVE EXTERNALITIES
dc.subjectNETWORK EXTERNALITIES
dc.subjectOFFSHORE CENTER
dc.subjectOFFSHORE FINANCIAL CENTER
dc.subjectOPEN ECONOMIES
dc.subjectOUTPUT
dc.subjectPAYMENT SERVICES
dc.subjectPENSION
dc.subjectPENSION FUND
dc.subjectPENSION FUND ASSETS
dc.subjectPENSION FUNDS
dc.subjectPENSION REFORMS
dc.subjectPER CAPITA INCOME
dc.subjectPOLICY RESPONSE
dc.subjectPOLITICAL ECONOMY
dc.subjectPORTFOLIO
dc.subjectPOSITIVE EXTERNALITIES
dc.subjectPRIVATE CREDIT
dc.subjectPRIVATE DEBT
dc.subjectPROPERTY RIGHTS
dc.subjectPUBLIC DEBT
dc.subjectPUBLIC DEBT SECURITIES
dc.subjectPUBLIC GOOD
dc.subjectREPO
dc.subjectRESERVE
dc.subjectRETAIL INVESTORS
dc.subjectRETURNS
dc.subjectRETURNS TO SCALE
dc.subjectRISK DIVERSIFICATION
dc.subjectRISK PROFILES
dc.subjectRULE OF LAW
dc.subjectSCALE EFFECTS
dc.subjectSECURITIES MARKETS
dc.subjectSOLVENCY
dc.subjectSTOCK EXCHANGES
dc.subjectSTOCK MARKET
dc.subjectSTOCK MARKET CAPITALIZATION
dc.subjectSTOCK MARKETS
dc.subjectSTOCK TRADING
dc.subjectSTOCKS
dc.subjectTAX
dc.subjectTAXATION
dc.subjectTRADING
dc.subjectTRADING PLATFORM
dc.subjectTRANSACTION
dc.subjectTRANSACTION COSTS
dc.subjectTRANSITION COUNTRY
dc.subjectUNDERLYING PROBLEM
dc.subjectUSE OF COLLATERAL
dc.subjectVALUE ADDED
dc.subjectVALUE OF COLLATERAL
dc.subjectWEALTH
dc.titleFinancial Development : Structure and Dynamicsen
dspace.entity.typePublication
okr.crossref.titleFinancial Development: Structure and Dynamics
okr.date.disclosure2011-10-01
okr.date.doiregistration2025-04-10T11:08:35.274171Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.docurlhttp://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20111024134059
okr.guid118231468325154387
okr.identifier.doi10.1596/1813-9450-5854
okr.identifier.externaldocumentum000158349_20111024134059
okr.identifier.internaldocumentum15348558
okr.identifier.reportWPS5854
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/10/24/000158349_20111024134059/Rendered/PDF/WPS5854.pdfen
okr.region.administrativeWorld
okr.region.administrativeWorld
okr.relation.associatedurlhttps://openknowledge.worldbank.org/handle/10986/21620
okr.unitDevelopment Research Group (DECRG)
okr.volume1 of 1
relation.isAuthorOfPublication35317b87-0569-5cde-bb5e-db1a425e6889
relation.isAuthorOfPublicationddbea2d3-9cc2-52f4-ab28-94372063d761
relation.isAuthorOfPublication.latestForDiscovery35317b87-0569-5cde-bb5e-db1a425e6889
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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