Convergence of financial systems: Towards an evolutionary perspective
AbstractThis paper provides an evolutionary perspective on financial systems based on complex systems theory. This perspective is used to organize the discussion about the convergence and non-convergence of financial systems. In recent years the discussion about the relative merits and the efficiency of market- and bank-based financial systems is subject to considerable academic and policy debate throughout the world. Bank- and market-based systems are found to give rise to different economic and corporate dynamics. Based on a notion of financial systems as configuration of complementary elements, it is suggested that the convergence of financial systems is best conceptualized as path dependent process of institutional change. This is illustrated with special reference to the recent developments of convergence of financial systems in Europe. The implication of the evolutionary perspective on financial systems is that neither theories using a simple evolutionary argument of survival of the fittest nor theories related to a institutional ossification perspective can provide much guidance for analyzing the transformations of financial systems. A multilevel institutional analysis which takes the interdependencies between national and firm-level institutions explicitly into account is required.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Vienna University of Economics and B.A. Research Group: Growth and Employment in Europe: Sustainability and Competitiveness in its series Working Papers with number geewp31.
Date of creation: Aug 2003
Date of revision:
Note: PDF Document
Contact details of provider:
Postal: Augasse 2-6, 1090 Vienna, Austria
Web page: http://www.wu-wien.ac.at/inst/vw1/gee/
Institutional convergence; financial system; NK model; systems competition; path dependency; corporate governance;
Other versions of this item:
- H Lzl, Werner, 2006. "Convergence of financial systems: towards an evolutionary perspective," Journal of Institutional Economics, Cambridge University Press, vol. 2(01), pages 67-90, April.
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
- P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-09-08 (All new papers)
- NEP-FIN-2003-09-08 (Finance)
- NEP-MFD-2003-09-08 (Microfinance)
- NEP-PKE-2003-09-08 (Post Keynesian Economics)
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.:
- Cobham, David & Cosci, Stefania & Mattesini, Fabrizio, 1999. "The Italian Financial System: Neither Bank Based nor Market Based," Manchester School, University of Manchester, vol. 67(3), pages 325-45, June.
- Black, Bernard S. & Gilson, Ronald J., 1998. "Venture capital and the structure of capital markets: banks versus stock markets," Journal of Financial Economics, Elsevier, vol. 47(3), pages 243-277, March.
- Mayer, Colin, 1988.
"New issues in corporate finance,"
European Economic Review,
Elsevier, vol. 32(5), pages 1167-1183, June.
- Carlin, Wendy & Mayer, Colin, 1999.
"Finance, Investment and Growth,"
CEPR Discussion Papers
2233, C.E.P.R. Discussion Papers.
- O'Sullivan, Mary, 2000. "The Innovative Enterprise and Corporate Governance," Cambridge Journal of Economics, Oxford University Press, vol. 24(4), pages 393-416, July.
- Franklin Allen & Douglas Gale, 1996.
"Financial Markets, Intermediaries and Intertemporal Smoothing,"
Center for Financial Institutions Working Papers
96-33, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Allen, Franklin & Gale, Douglas, 1997. "Financial Markets, Intermediaries, and Intertemporal Smoothing," Journal of Political Economy, University of Chicago Press, vol. 105(3), pages 523-46, June.
- Franklin Allen & Douglas Gale, 1995. "Financial Markets, Intermediaries, and Intertemporal Smoothing," Center for Financial Institutions Working Papers 95-02, Wharton School Center for Financial Institutions, University of Pennsylvania.
- Franklin Allen & Douglas Gale, 1995. "Financial markets, intermediaries, and intertemporal smoothing," Working Papers 95-4, Federal Reserve Bank of Philadelphia.
- Steven M. Fazzari & R. Glenn Hubbard & BRUCE C. PETERSEN, 1988.
"Financing Constraints and Corporate Investment,"
Brookings Papers on Economic Activity,
Economic Studies Program, The Brookings Institution, vol. 19(1), pages 141-206.
- Koen Frenken & Luigi Marengo & Marco Valente, 1999. "Interdependencies, nearly-decomposability and adaption," CEEL Working Papers 9903, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
- Raghuram G. Rajan & Luigi Zingales, 1998.
"Which Capitalism? Lessons from the East Asian Crisis,"
CRSP working papers
486, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Raghuram G. Rajan & Luigi Zingales, 1998. "Which Capitalism? Lessons Form The East Asian Crisis," Journal of Applied Corporate Finance, Morgan Stanley, vol. 11(3), pages 40-48.
- Ross Levine, 1997.
"Financial Development and Economic Growth: Views and Agenda,"
Journal of Economic Literature,
American Economic Association, vol. 35(2), pages 688-726, June.
- Levine, Ross, 1996. "Financial development and economic growth : views and agenda," Policy Research Working Paper Series 1678, The World Bank.
- Rafael LaPorta & Florencio Lopez de-Silanes & Andrei Shleifer & Robert W. Vishny, 1997.
"Legal Determinants of External Finance,"
Harvard Institute of Economic Research Working Papers
1788, Harvard - Institute of Economic Research.
- RAFAEL LaPORTA & FLORENCIO LOPEZ-de-SILANES & ANDREI SHLEIFER & ROBERT W. VISHNY, . "Legal Determinants of External Finance,"," CRSP working papers 324, Center for Research in Security Prices, Graduate School of Business, University of Chicago.
- Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer & Robert W. Vishny, 1997. "Legal Determinants of External Finance," NBER Working Papers 5879, National Bureau of Economic Research, Inc.
- Malcolm Edey & Ketil Hviding, 1995. "An Assessment of Financial Reform in OECD Countries," OECD Economics Department Working Papers 154, OECD Publishing.
- La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei & Vishny, Robert W., 1998.
"Law and Finance,"
3451310, Harvard University Department of Economics.
- Rafael LaPorta & Florencio Lopez de-Silanes & Andrei Shleifer & Robert W. Vishny, 1996. "Law and Finance," Harvard Institute of Economic Research Working Papers 1768, Harvard - Institute of Economic Research.
- Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer & Robert W. Vishny, 1996. "Law and Finance," NBER Working Papers 5661, National Bureau of Economic Research, Inc.
- Takeo Hoshi & Anil Kashyap & David Scharfstein, 1989.
"Corporate structure, liquidity, and investment: evidence from Japanese industrial groups,"
Finance and Economics Discussion Series
82, Board of Governors of the Federal Reserve System (U.S.).
- Hoshi, Takeo & Kashyap, Anil & Scharfstein, David, 1991. "Corporate Structure, Liquidity, and Investment: Evidence from Japanese Industrial Groups," The Quarterly Journal of Economics, MIT Press, vol. 106(1), pages 33-60, February.
- Gompers, Paul A, 1995. " Optimal Investment, Monitoring, and the Staging of Venture Capital," Journal of Finance, American Finance Association, vol. 50(5), pages 1461-89, December.
- Jackie Krafft & Jacques-Laurent Ravix, 2005. "The governance of innovative firms: An evolutionary perspective," Economics of Innovation and New Technology, Taylor and Francis Journals, vol. 14(3), pages 125-147.
- Rajan, Raghuram G & Zingales, Luigi, 1995.
" What Do We Know about Capital Structure? Some Evidence from International Data,"
Journal of Finance,
American Finance Association, vol. 50(5), pages 1421-60, December.
- Raghuram G. Rajan & Luigi Zingales, 1994. "What Do We Know About Capital Structure? Some Evidence from International Data," NBER Working Papers 4875, National Bureau of Economic Research, Inc.
- Jensen, Michael C, 1986. "Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers," American Economic Review, American Economic Association, vol. 76(2), pages 323-29, May.
- Robert N. McCauley & Steven A. Zimmer, 1989. "Explaining international differences in the cost of capital," Quarterly Review, Federal Reserve Bank of New York, issue Sum, pages 7-28.
- David, Paul A., 1994. "Why are institutions the 'carriers of history'?: Path dependence and the evolution of conventions, organizations and institutions," Structural Change and Economic Dynamics, Elsevier, vol. 5(2), pages 205-220, December.
- Raghuram G. Rajan & Luigi Zingales, 2000.
"The Governance of the New Enterprise,"
NBER Working Papers
7958, National Bureau of Economic Research, Inc.
- Pelikan, Pavel, 2003. "Bringing Institutions Into Evolutionary Economics: Another View with Links to Changes in Physical and Social Technologies," Ratio Working Papers 24, The Ratio Institute.
- Colin Mayer, 1998. "Financial Systems and Corporate Governance: A Review of the International Evidence," Journal of Institutional and Theoretical Economics (JITE), Mohr Siebeck, Tübingen, vol. 154(1), pages 144-, March.
- Mayer, Colin, 2002.
"Financing the New Economy: financial institutions and corporate governance,"
Information Economics and Policy,
Elsevier, vol. 14(2), pages 311-326, June.
- Mayer, Colin, 2001. "Financing the New Economy. Financial Institutions and Corporate Governance," Working Papers UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).
- Pavel Pelikan, 2003. "Bringing institutions into evolutionary economics: another view with links to changes in physical and social technologies," Journal of Evolutionary Economics, Springer, vol. 13(3), pages 237-258, August.
- Corbett, Jenny & Jenkinson, Tim, 1997. "How Is Investment Financed? A Study of Germany, Japan, the United Kingdom and the United States," The Manchester School of Economic & Social Studies, University of Manchester, vol. 65(0), pages 69-93, Supplemen.
- Petersen, Mitchell A & Rajan, Raghuram G, 1994. " The Benefits of Lending Relationships: Evidence from Small Business Data," Journal of Finance, American Finance Association, vol. 49(1), pages 3-37, March.
- Cobham, David & Serre, Jean-Marin, 2000. "A Characterization of the French Financial System," Manchester School, University of Manchester, vol. 68(1), pages 44-67, January.
- Simplice A, Asongu, 2012. "African Financial Development Dynamics: Big Time Convergence," MPRA Paper 36053, University Library of Munich, Germany.
- Jackie Krafft & Yiping Qu & Francesco Quatraro & Jacques-Laurent Ravix, 2013.
"Corporate governance, value and performance of firms: New empirical results on convergence from a large international database,"
- Jackie Krafft & Yiping Qu & Francesco Quatraro & Jacques-Laurent Ravix, 2013. "Corporate governance, value and performance of firms: New empirical results on convergence from a large international database," Post-Print hal-00786664, HAL.
- Simplice A, Asongu, 2012. "African Stock Market Performance Dynamics: A Multidimensional Convergence Assessment," MPRA Paper 36055, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Werner Hoelzl).
If references are entirely missing, you can add them using this form.