Ayyagari, MeghanaDemirguc-Kunt, AsliMaksimovic, Vojislav2012-04-272012-04-272012-04https://hdl.handle.net/10986/6038This paper reviews and synthesizes theoretical and empirical research on the role of finance in developing countries. First, the paper presents the stylized facts about firms in developing nations as well as the legal, financial and broader institutional framework in which these firms operate. Next, the paper focuses on the financing choices available to small and medium firms in developing countries and highlights areas needing additional research.CC BY 3.0 IGOACCESS TO BANKACCESS TO EXTERNAL FINANCEACCESS TO FINANCEACCESS TO FINANCINGACCOUNTINGACCOUNTING STANDARDSAGENCY PROBLEMAGENCY PROBLEMSAGRICULTURAL CREDITALLOCATION OF CAPITALASYMMETRIC INFORMATIONBALANCE SHEETSBANK ACCOUNTBANK ACCOUNTSBANK BRANCHESBANK CREDITBANK FINANCINGBANK LENDINGBANKING SECTORBANKING SYSTEMBINDING CONSTRAINTBUSINESS CYCLESCAPITAL ALLOCATIONCAPITAL FLOWSCAPITAL MARKETCAPITAL MARKET DEVELOPMENTCAPITAL MARKETSCAPITAL MOBILITYCAPITAL STOCKCAPITAL STRUCTURECAPITAL STRUCTURESCASH FLOWSCASH HOLDINGSCENTRAL BANKCENTRAL BANKSCIVIL LAWCOMMON LAWCONTRACTUAL OBLIGATIONSCORPORATE BONDCORPORATE BOND MARKETCORPORATE FINANCECORPORATE GOVERNANCECREDIT BUREAUSCREDIT CARDSCREDIT MARKETCREDIT MARKETSCREDIT RATIONINGCREDIT REGISTRIESCREDIT RISKCREDITORCREDITOR RIGHTSCREDITORSCURRENCYDEBTDEBT FINANCINGDEBT LEVELSDEBT MATURITYDEFAULT RATESDEPOSITDEPOSIT MONEY BANKSDEVELOPING COUNTRIESDEVELOPING COUNTRYDEVELOPMENT FINANCEDISCLOSURE REQUIREMENTSDISTRIBUTION OF CREDITECONOMIC DEVELOPMENTECONOMIC GROWTHEMERGING MARKETSEQUITY CAPITALEQUITY MARKETSEXPENDITURESEXPROPRIATIONEXPROPRIATION OF MINORITY SHAREHOLDERSEXTERNAL FINANCEEXTERNAL FUNDINGEXTERNAL INVESTORSFINANCIAL ASSETSFINANCIAL CRISISFINANCIAL DEVELOPMENTFINANCIAL DISTRESSFINANCIAL FRAGILITYFINANCIAL INSTITUTIONSFINANCIAL INSTRUMENTSFINANCIAL LIBERALIZATIONFINANCIAL MARKETFINANCIAL MARKETSFINANCIAL SECTOR DEVELOPMENTFINANCIAL STRUCTURESFINANCIAL SYSTEMFINANCIAL SYSTEMSFINANCING OBSTACLESFIXED ASSETSFOREIGN BANKFOREIGN BANK ENTRYFOREIGN BANKSFOREIGN CAPITALFOREIGN CURRENCYFOREIGN DIRECT INVESTMENTFUTURE CASH FLOWGLOBAL CAPITALGLOBALIZATIONGOVERNMENT BANKSGOVERNMENT INTERVENTIONGOVERNMENT LENDINGGOVERNMENT OWNERSHIPGOVERNMENT SUBSIDIESHOLDINGINFLATIONINFORMAL FINANCEINFORMATION ASYMMETRYINFORMATION SHARINGINITIAL PUBLIC OFFERINGSINSTITUTIONAL DEVELOPMENTINSTRUMENTINSURANCEINTANGIBLEINTANGIBLE ASSETSINTEREST RATESINTERNATIONAL BANKINTERNATIONAL CAPITALINTERNATIONAL FINANCEINTERNATIONAL MARKETSINVESTMENT FUNDSINVESTMENT OPPORTUNITIESINVESTMENT RATEINVESTMENT-CASH FLOW SENSITIVITIESINVESTOR INTERESTINVESTOR PROTECTIONINVESTOR PROTECTIONSIPOISSUANCEISSUANCESJUDICIAL SYSTEMJUDICIAL SYSTEMSLABOR MARKETLEGAL ENVIRONMENTLEGAL ENVIRONMENTSLEGAL PROTECTIONLEGAL RIGHTSLEGAL SYSTEMLEGAL SYSTEMSLEGAL TRADITIONLEGAL TRADITIONSLENDERSLEVEL OF DEBTLINES OF CREDITLIQUIDATIONLIQUIDITYLOANLOCAL FINANCELONG TERM DEBTLONG-TERM DEBTMACROECONOMIC INSTABILITYMARKET ECONOMYMARKET FAILUREMARKET LIQUIDITYMARKET REGULATORSMARKET TURNOVERMARKET VALUEMATURITY STRUCTURESMICRO DATAMICRO-ENTERPRISESMICROENTERPRISESOUTSIDE INVESTORSOVERDRAFT FACILITYOWNERSHIP STRUCTUREOWNERSHIP STRUCTURESPOLICY RESPONSESPOLITICAL ECONOMYPOLITICAL STABILITYPORTFOLIOPRIVATE BANKSPRIVATE CREDITPRIVATE CREDIT BUREAUSPRIVATE INVESTORSPROPERTY RIGHTSPROPERTY RIGHTS PROTECTIONPROPERTY RIGHTS PROTECTIONSPROTECTION OF INVESTORPUBLIC BANKSPUBLIC CREDITPUBLIC MARKETSPUBLIC REGISTRIESRATES OF RETURNSREGULATORY AUTHORITIESREINVESTMENTREPUDIATIONRETURNRETURNSRISK OF EXPROPRIATIONRULE OF LAWSECURITIESSECURITIES MARKETSSECURITY INTERESTSSEIZURESSETTLEMENTSHAREHOLDERSHAREHOLDERSSHORT-TERM DEBTSMALL BUSINESSESSMALL LOANSSOCIAL CAPITALSTATE BANKSSTOCK MARKETSTOCK MARKET CAPITALIZATIONSTOCK MARKET DEVELOPMENTSTOCK MARKETSSTOCK RETURNSTAXTRADE BALANCESTRADE CREDITTRANSITION COUNTRIESTRANSPARENCYVALUATIONVALUE OF COLLATERALWorld Bank10.1596/1813-9450-6036