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The interplay of legal and social norms and the failure of the bank credit market in Bulgaria

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  • Größl, Ingrid

Abstract

We take up the widely held view that the observed discrepancy between law on the books and law in action has prevented economic transition and investigate its role for the failure of the Bulgarian credit market. In doing so, we focus on the role of injunctive informal institutions which have become internalized in the course of social development. Based on cross-cultural psychology, we show that a particular bundle of fundamental social norms which constitute basic value orientations have both prevented the development of stabilizing regulations and an overall compliance with prevailing laws.

Suggested Citation

  • Größl, Ingrid, 2005. "The interplay of legal and social norms and the failure of the bank credit market in Bulgaria," ZÖSS-Discussion Papers 04, University of Hamburg, Centre for Economic and Sociological Studies (CESS/ZÖSS).
    • Handle: RePEc:zbw:cessdp:04
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    References listed on IDEAS

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    1. Miller, Jeffrey & Petranov, Stefan, 2001. "The Financial system in the Bulgarian economy," MPRA Paper 107704, University Library of Munich, Germany, revised Oct 2001.
    2. Kenneth Koford & Adrian E. Tschoegl, 1997. "Problems of Bank Lending in Bulgaria: Information Asymmetry and Institutional Learning," Center for Financial Institutions Working Papers 97-41, Wharton School Center for Financial Institutions, University of Pennsylvania.
    3. 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.
    4. M. Berlemann & K. Hristov & Nikolay Nenovsky, 2002. "Lending of last resort, moral hazard and twin crises. Lessons from the Bulgarian financial crises 1996/1997," Post-Print halshs-00260052, HAL.
    5. Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer & Robert W. Vishny, 1998. "Law and Finance," Journal of Political Economy, University of Chicago Press, vol. 106(6), pages 1113-1155, December.
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    7. Nikolay Nenovsky & E. Peev & T. Yalamov, 2003. "Banks-Firms Nexus under the Currency Board: Empirical Evidence from Bulgaria," Post-Print halshs-00259830, HAL.
    8. Rajan, Raghuram G, 1992. "Insiders and Outsiders: The Choice between Informed and Arm's-Length Debt," Journal of Finance, American Finance Association, vol. 47(4), pages 1367-1400, September.
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    More about this item

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • P14 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Property Rights
    • P21 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Planning, Coordination, and Reform
    • P31 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions
    • P39 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Other
    • Z00 - Other Special Topics - - General - - - General

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