Financial Reform and Banking Crises
AbstractWe examine the impact of various dimensions of financial reform on the likelihood of systemic and non-systemic banking crises. Using new financial reform measures for a large sample of developing and developed countries for the period 1973 to 2002, our multivariate probit modeling results suggest that conditional on adequate banking supervision, certain dimensions of financial reform reduce the likelihood of systemic crises. We also show that after a country has reformed, the introduction of further reforms becomes easier and leads to more stable financial systems. We also find some evidence that the likelihood of non-systemic crisis increases after financial reform.
Download InfoIf 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.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2870.
Date of creation: 2009
Date of revision:
banking crises; financial reform; financial fragility;
Find related papers by JEL classification:
- E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Barth, James R. & Caprio Jr., Gerard & Levine, Ross, 2001.
"Bank regulation and supervision : what works best?,"
Policy Research Working Paper Series
2725, The World Bank.
- Enrica Detragiache & Asli DemirgÃ¼Ã§-Kunt, 1999.
"Monitoring Banking Sector Fragility - A Multivariate Logit Approach,"
IMF Working Papers
99/147, International Monetary Fund.
- Demirguc, Asli & Detragiache, Enrica, 2000. "Monitoring Banking Sector Fragility: A Multivariate Logit Approach," World Bank Economic Review, World Bank Group, vol. 14(2), pages 287-307, May.
- Tamás Bartus, 2005. "Estimation of marginal effects using margeff," Stata Journal, StataCorp LP, vol. 5(3), pages 309-329, September.
- Abdul Abiad & Enrica Detragiache & Thierry Tressel, 2010.
"A New Database of Financial Reforms,"
IMF Staff Papers,
Palgrave Macmillan, vol. 57(2), pages 281-302, June.
- Graciela Laura Kaminsky, 1999.
"Currency and Banking Crises - The Early Warnings of Distress,"
IMF Working Papers
99/178, International Monetary Fund.
- Graciela L. Kaminsky, 1998. "Currency and banking crises: the early warnings of distress," International Finance Discussion Papers 629, Board of Governors of the Federal Reserve System (U.S.).
- William Greene, 2004. "The behaviour of the maximum likelihood estimator of limited dependent variable models in the presence of fixed effects," Econometrics Journal, Royal Economic Society, vol. 7(1), pages 98-119, 06.
- Fabian Valencia & Luc Laeven, 2008. "Systemic Banking Crises: A New Database," IMF Working Papers 08/224, International Monetary Fund.
- Shehzad, Choudhry Tanveer & de Haan, Jakob & Scholtens, Bert, 2010. "The impact of bank ownership concentration on impaired loans and capital adequacy," Journal of Banking & Finance, Elsevier, vol. 34(2), pages 399-408, February.
- Bilin Neyapti & Nazire Nergiz Dincer, 2010. "Macroeconomic Impact of Bank Regulation and Supervision : A cross-country investigation," Departmental Working Papers 1005, Bilkent University, Department of Economics.
- Kilinc, Mustafa & Neyapti, Bilin, 2012. "Bank regulation and supervision and its welfare implications," Economic Modelling, Elsevier, vol. 29(2), pages 132-141.
- Caprio, Gerard Jr. & D'Apice, Vincenzo & Ferri, Giovanni & Puopolo, Giovanni Walter, 2010. "Macro Financial Determinants of the Great Financial Crisis: Implications for Financial Regulation," MPRA Paper 26088, University Library of Munich, Germany.
- Luca Papi & Andrea Filippo Presbitero & Alberto Zazzaro, 2013. "IMF Lending and Banking Crises," Mo.Fi.R. Working Papers 80, Money and Finance Research group (Mo.Fi.R.) - Univ. Politecnica Marche - Dept. Economic and Social Sciences.
- Pablo Gluzmann & Martín Guzman, 2011. "Financial Reforms and Financial Instability," Ensayos Económicos, Central Bank of Argentina, Economic Research Department, vol. 1(61-62), pages 35-73, January -.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If references are entirely missing, you can add them using this form.