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Finance, Firm Size, and Growth

  • THORSTEN BECK
  • ASLI DEMIRGUC-KUNT
  • LUC LAEVEN
  • ROSS LEVINE

Although research shows that financial development accelerates aggregate economic growth, economists have not resolved conflicting theoretical predictions and ongoing policy disputes about the cross-firm distributional effects of financial development. Using cross-industry, cross-country data, the results are consistent with the view that financial development exerts a disproportionately positive effect on small firms. These results have implications for understanding the political economy of financial sector reform. Copyright (c) 2008 International Monetary Fund with Exclusive License to Print by The Ohio State University.

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1538-4616.2008.00164.x
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Article provided by Blackwell Publishing in its journal Journal of Money, Credit and Banking.

Volume (Year): 40 (2008)
Issue (Month): 7 (October)
Pages: 1379-1405

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Handle: RePEc:mcb:jmoncb:v:40:y:2008:i:7:p:1379-1405
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