Caggiano, GiovanniCalice, Pietro2016-06-142016-06-142016-05https://hdl.handle.net/10986/24526The relationship between bank competition, firm access to finance, and economic growth is a much debated topic in the economic literature and in policy circles. This paper uses a panel of 23 manufacturing sectors over 2002-10 to investigate the impact of bank competition on industry growth in the Gulf Cooperation Council economies. The results show that greater competition allows financially dependent firms to grow faster. In addition, the results show that lower restrictions on banks’ permissible activities, better credit information, and greater institutional effectiveness mitigate the damaging impact of low competition. These results are robust to a variety of checks. The findings suggest that improving bank competition should be an important aspect of the financial sector development agenda in the Gulf Cooperation Council.en-USCC BY 3.0 IGOACCESS TO CREDITCREDIT MARKETSFOREIGN ENTRYCAPITAL MARKETSFINANCIAL SERVICESBORROWERSTATE‐OWNED BANKSECONOMIC GROWTHEXTERNAL FINANCINGCREDIT ALLOCATIONCAPITAL ACCUMULATIONEXTERNAL FUNDSFINANCINGFINANCIAL MANAGEMENTBANKING INDUSTRYINTERESTMORAL HAZARDINDUSTRYBIASPRIVATE CREDITPRIVATE CREDITAVAILABILITY OF CREDITBANKING SYSTEMSERVICESPUBLIC SERVICESACCESS TO EXTERNAL FINANCEBANKING SYSTEMSFINANCIAL MANAGEMENTCAPITAL STRUCTUREAVAILABILITY OF CREDITCREDIT CONSTRAINTSDEFAULT RISKINFORMATION SHARINGECONOMIC POLICYCREDIT ALLOCATIONSOURCES OF FINANCECAPITAL MARKETSBORROWERSBANK ASSETSGREATER ACCESSINTERNATIONAL BANKINFORMATION ASYMMETRIESCASH FLOWSBANK COMPETITIONBANKING SECTORBANKING SYSTEMSBANK LENDINGBANKING CRISESEXTERNAL FINANCEDEFAULT RISKLACK OF CREDITCREDIT ACCESSRETURN ON ASSETSMORAL HAZARDFOREIGN BANKSADVANCED ECONOMIESBANK ASSETSCREDIT BUREAUSCREDIT BUREAUSLENDING DECISIONSCORPORATE FINANCEINFORMATION SHARINGFINANCIAL SERVICES PROVIDERSFINANCIAL INSTITUTIONSMARKETSPUBLIC SERVICESENTRY BARRIERSACCESS TO FINANCEENTERPRISESFINANCIAL ACCESSBANK CREDITSOURCES OF FINANCEBANK LENDINGREAL ESTATERETURN ON ASSETSFINANCEBANKING SECTORENTRY BARRIERSINFORMATION ASYMMETRYBANKSSOURCES OF FINANCESTATE‐ OWNED BANKSCREDIT INFORMATIONCREDIT CONSTRAINTSCREDIT REGISTRIESCAPITALRETAIL BANKINGFINANCIAL STABILITYPUBLIC POLICIESACCESS TO FINANCECREDIT ACCESSVALUEBANKCREDITACCESSIBILITYFOREIGN ENTRYEXTERNAL FUNDSEXPENDITURESCREDIT INFORMATIONCIVIL SERVICEFOREIGN BANKSFINANCIAL ACCESSGOVERNMENT INTERVENTIONBANK COMPETITIONINFORMATION ASYMMETRIESRISK OF BANK FAILUREFINANCIAL INSTITUTIONSDIVERSIFICATIONSECURITIESSYSTEMIC INSTABILITYGOVERNANCEINSURANCEFINANCIAL DEVELOPMENTACCESS TO CREDITACCESS TO FINANCEACCESS TO EXTERNAL FINANCEECONOMIC DEVELOPMENTLENDING DECISIONSINFORMATION ASYMMETRYBANK CREDITFINANCIAL SERVICES PROVIDERSFINANCIAL DEVELOPMENTRETAINED EARNINGSSTATE‐OWNED BANKSREAL ESTATEINVESTMENTFINANCIAL INTERMEDIATIONRISKCAPITAL STRUCTURECREDIT REGISTRYFINANCIAL MARKETSBANKINGCOOPERATIONBANKING INDUSTRYFINANCIAL SECTOR DEVELOPMENTREVENUELACK OF CREDITBANKING SYSTEMEARNINGSGREATER ACCESSBORROWINGLENDINGCAPITAL EXPENDITURESFINANCIAL SECTOR DEVELOPMENTFINANCIAL SERVICESEXTERNAL FINANCINGENTREPRENEURSHIPBANKING CRISESFINANCIAL MARKETSGOVERNMENTSBANK FAILURECIVIL SERVICECREDIT MARKETSRETAINED EARNINGSECONOMIC GROWTHCREDIT REGISTRYFINANCIAL SECTOR DEVELOPMENTFINANCIAL DEPTHINCOME GROUPSGOVERNMENT INTERVENTIONCREDIT MARKETCOMPETITIONEMPLOYEESWorking PaperWorld Bank10.1596/1813-9450-7687