IDEAS home Printed from
MyIDEAS: Login to save this article or follow this journal

Financial development and growth: where do we stand?

  • Ross Levine

In spite of the recent theoretical and empirical work that suggests that financial Systems exert a first-order, causal impact on economic growth, economists are still not very able of providing policy makers with detailed blueprints of how to create growth-promoting financial systems. The profession has only recently assembled broad cross-country data on financial structure and taken initial steps on comparing bank-based and market-based systems. This paper selectively reviews evidence on banks, markets, and financial structure. In terms of banks, the paper discusses why bans emerge, what they do, and how they affect economic performance. Next, it discusses evidence on the legal, accounting, and regulatory determinants of healthy banking development. The evidence suggests that legal and regulatory reforms that strengthen creditor rights, contract enforcement, and accounting practices boost banking sector development and accelerate economic growth. The paper next examines the impact of stock markets

If 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.

File URL:
Download Restriction: no

Article provided by University of Chile, Department of Economics in its journal Estudios de Economia.

Volume (Year): 26 (1999)
Issue (Month): 2 Year 1999 (December)
Pages: 113-136

in new window

Handle: RePEc:udc:esteco:v:26:y:1999:i:2:p:113-136
Contact details of provider: Web page:

More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:udc:esteco:v:26:y:1999:i:2:p:113-136. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Verónica Kunze)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.