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Can financial development enhance transparency?

Author

Listed:
  • Nabamita Dutta

    (University of Wisconsin, La Crosse)

  • Deepraj Mukherjee

    (Kent State University)

Abstract

A substantial strand of literature unambiguously established the importance of financial development for economic growth. Relatively less attention has been paid to the impact that financial development of a country can have on important development outcomes like transparency. As established by existing research, strong financial institutions in a country would imply an improved and transparent banking system, better corporate governance, ease of accessing credit, greater availability of information and best practices in investment protection. All these should theoretically promise a more transparent economic system. Our empirical findings confirm this. Using several estimation strategies, our results confirm that greater financial development enhances transparency.

Suggested Citation

  • Nabamita Dutta & Deepraj Mukherjee, 2018. "Can financial development enhance transparency?," Economic Change and Restructuring, Springer, vol. 51(4), pages 279-302, November.
    • Handle: RePEc:kap:ecopln:v:51:y:2018:i:4:d:10.1007_s10644-017-9205-6
    DOI: 10.1007/s10644-017-9205-6
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    More about this item

    Keywords

    Institutions; Transparency; Financial development;
    All these keywords.

    JEL classification:

    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

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