Do Financial Sector Reforms Lead to Financial Development? : Evidence from a New Dataset /

This paper studies whether the policies that, over the past decades, liberalized bankingsystems around the world have resulted in deeper credit markets. To measure banking sectorreforms we use a new index that tracks policy changes in five separate areas for 91 countriesover 1973-2005. We find that...

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Bibliographic Details
Main Author: Tressel, Thierry
Other Authors: Detragiache, Enrica
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2008.
Series:IMF Working Papers; Working Paper ; No. 2008/265
Online Access:Full text available on IMF
Description
Summary:This paper studies whether the policies that, over the past decades, liberalized bankingsystems around the world have resulted in deeper credit markets. To measure banking sectorreforms we use a new index that tracks policy changes in five separate areas for 91 countriesover 1973-2005. We find that reforms have led to financial deepening, but only in countrieswith institutions that place checks and balances on political power. We interpret this asevidence of a complementarity between financial sector reforms and political institutions thatprotect property rights. Other country characteristics do not seem to significantly influencethe effect of banking reforms on financial development.
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Physical Description:1 online resource (42 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students