Advanced Search
MyIDEAS: Login to save this article or follow this journal

Democratization and Financial Reform in Taiwan: The Political Economy of Bad-Loan Creation

Contents:

Author Info

  • Sato, Yukihito
Registered author(s):

    Abstract

    This study shows that many bad loans now burdening Taiwan's financial institutions are interrelated with the society's democratization which started in the late 1980s. Democratization made the local factions and business groups more independent from the Kuomintang government. They acquired more political influence than under the authoritarian regime. These changes induced them to manage their owned financial institutions more arbitrarily and to intervene more frequently in the state-affiliated financial institutions. Moreover they interfered in financial reform and compelled the government to allow many more new banks than it had originally planned. As a result the financial system became more competitive and the qualities of loans deteriorated. Some local factions and business groups exacerbated the situation by establishing banks in order to funnel funds to themselves, sometimes illegally. Thus many bad loans were created as the side effect of democratization.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://ir.ide.go.jp/dspace/bitstream/2344/111/1/ARRIDE_DE_Vol40%283%29_2002.03.02_sato.pdf
    Download Restriction: no

    Bibliographic Info

    Article provided by Institute of Developing Economies, Japan External Trade Organization(JETRO) in its journal The Developing Economies.

    Volume (Year): 40 (2002)
    Issue (Month): 3 (September)
    Pages: 226-251

    as in new window
    Handle: RePEc:jet:deveco:v:40:y:2002:i:3:p:226-251

    Contact details of provider:
    Postal: 3-2-2 Wakaba, Mihama-ku, Chiba-shi, Chiba 261-8545
    Fax: +81-43-299-9726
    Email:
    Web page: http://www.ide.go.jp/
    More information through EDIRC

    Order Information:
    Web: http://blackwellpublishing.com/subs.asp?ref=0012-1533&site=1

    Related research

    Keywords: Taiwan; Politics; Economy; Democratization; Finance;

    Find related papers by JEL classification:

    References

    No references listed on IDEAS
    You can help add them by filling out this form.

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:jet:deveco:v:40:y:2002:i:3:p:226-251. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Marie Kobayashi).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.