Financial Development: A Broader Perspective
AbstractThis paper seeks to add to the current debate about financial development and growth in the emerging world by looking at how different financial systems evolve: how and why financial structures change during various stages of development, how best to measure them, and seeing what practical policy lessons can be drawn from historical experience. Some financial structures may be better suited to growth at certain stages of development but they may be less well suited in other circumstances. In the search for optimal financial structure, rather than attempt to adopt another country’s particular structure it may be more fruitful for today’s emerging world to concentrate more on addressing the needs of savers and borrowers in each individual system. A major lesson for the emerging world from past financial development is that there are risks involved in transitioning from one framework to another. Too fast a change increases the danger that all the necessary regulatory, supervisory and educational changes may not keep pace with the financial changes. This can increase the susceptibility to instability and reduce resilience to shocks.
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Bibliographic InfoPaper provided by Asian Development Bank Institute in its series ADBI Working Papers with number 258.
Length: 22 pages
Date of creation: 16 Dec 2010
Date of revision:
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financial system development; history; measurement; policies; lessons;
Find related papers by JEL classification:
- E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
- F00 - International Economics - - General - - - General
- F01 - International Economics - - General - - - Global Outlook
- F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
- G00 - Financial Economics - - General - - - General
- G01 - Financial Economics - - General - - - Financial Crises
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
- G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
- N00 - Economic History - - General - - - General
- N01 - Economic History - - General - - - Development of the Discipline: Historiographical; Sources and Methods
- N20 - Economic History - - Financial Markets and Institutions - - - General, International, or Comparative
- N30 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - General, International, or Comparative
- N40 - Economic History - - Government, War, Law, International Relations, and Regulation - - - General, International, or Comparative
- O10 - Economic Development, Technological Change, and Growth - - Economic Development - - - General
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-12-23 (All new papers)
- NEP-FMK-2010-12-23 (Financial Markets)
- NEP-MAC-2010-12-23 (Macroeconomics)
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