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Creating an efficient financial system : challenges in a global economy

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  • Beck, Thorsten

Abstract

Financial sector development fosters economic growth and reduces poverty by widening and broadening access to finance and allocating society's savings more efficiently. The author first discusses three pillars on which sound and efficient financial systems are built: macroeconomic stability and effective and reliable contractual and informational frameworks. He then describes three different approaches to government involvement in the financial sector: the laissez-faire view, the market-failure view and the market-enabling view. Finally, the author analyzes the sequencing of financial sector reforms and discusses the benefits and challenges that emerging markets face when opening their financial systems to international capital markets.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 3856.

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Date of creation: 01 Feb 2006
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Handle: RePEc:wbk:wbrwps:3856

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Keywords: Banks&Banking Reform; Financial Intermediation; Financial Crisis Management&Restructuring; Economic Theory&Research; Insurance&Risk Mitigation;

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Cited by:
  1. Barrett, Alan & Kearney, Ide & McCarthy, Yvonne, 2006. "Quarterly Economic Commentary, Winter 2006," Forecasting Report, Economic and Social Research Institute (ESRI), Economic and Social Research Institute (ESRI), number QEC20064, March.
  2. Beck, Thorsten & Buyukkarabacak, Berrak & Rioja, Felix & Valev, Neven, 2008. "Who gets the credit ? and does it matter ? household vs. firm lending across countries," Policy Research Working Paper Series 4661, The World Bank.
  3. Beck, Thorsten & Rahman, Md. Habibur, 2006. "Creating a more efficient financial system : challenges for Bangladesh," Policy Research Working Paper Series 3938, The World Bank.
  4. Claessens, Stijn, 2006. "Current challenges in financial regulation," Policy Research Working Paper Series 4103, The World Bank.
  5. Beck, Thorsten & Fuchs, Michael & Uy, Marilou, 2009. "Finance in Africa - Achievements and Challenges," Policy Research Working Paper Series 5020, The World Bank.
  6. Zhuang, Juzhong & Gunatilake, Herath & Niimi, Yoko & Ehsan Khan, Muhammad & Jiang, Yi & Hasan, Rana & Khor, Niny & S. Lagman-Martin, Anneli & Bracey, Pamela & Huang, Biao, 2009. "Financial Sector Development, Economic Growth, and Poverty Reduction: A Literature Review," ADB Economics Working Paper Series 173, Asian Development Bank.
  7. Hovhannes Toroyan & George C. Anayiotos, 2009. "Institutional Factors and Financial Sector Development," IMF Working Papers 09/258, International Monetary Fund.
  8. Honohan, P. & Beck, T.H.L., 2007. "Making finance work for Africa," Open Access publications from Tilburg University urn:nbn:nl:ui:12-3125420, Tilburg University.
  9. Corduneanu, Carmen & Iovu, Laura Raisa, 2008. "Steps in the development of the Romanian financial system and the corellation with the level of economical growth," MPRA Paper 12571, University Library of Munich, Germany.
  10. repec:ner:tilbur:urn:nbn:nl:ui:12-3508414 is not listed on IDEAS
  11. Demirguc-Kunt, Asli, 2006. "Finance and economic development : policy choices for developing countries," Policy Research Working Paper Series 3955, The World Bank.
  12. World Bank, 2007. "Bangladesh : Strategy for Sustained Growth, Volume 1. Summary Report," World Bank Other Operational Studies 7765, The World Bank.
  13. Beck, Thorsten & de la Torre, Augusto, 2006. "The basic analytics of access to financial services," Policy Research Working Paper Series 4026, The World Bank.
  14. Beck, Thorsten & Feyen, Erik & Ize, Alain & Moizeszowicz, Florencia, 2008. "Benchmarking financial development," Policy Research Working Paper Series 4638, The World Bank.

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