CAPITAL MISALLOCATION AND FINANCIAL DEVELOPMENT: A SECTOR-LEVEL ANALYSIS

We investigate the relationship between capital misallocation and financial development in six countries at different levels of development. We find that more developed financial systems perform better at allocating capital investment. If financial development is low, faster capital accumulation results in a worsening of allocative efficiency. This effect reverses for higher levels of financial development. Sectors with high R&D expenditures or high capital investment benefit most.

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Year of publication:	2017
Authors:	Upper, Christian ; Marconi, Daniela
Publisher:	Kiel, Hamburg : ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften, Leibniz-Informationszentrum Wirtschaft

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Series:	Beiträge zur Jahrestagung des Vereins für Socialpolitik 2017: Alternative Geld- und Finanzarchitekturen - Session: Growth and Development I ; F20-V2
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Conference Paper
Language:	English
Other identifiers:	hdl:10419/168205 [Handle] RePEc:zbw:vfsc17:168205 [RePEc]
Classification:	O47 - Measurement of Economic Growth; Aggregate Productivity ; O16 - Financial Markets; Saving and Capital Investment
Source:	EconStor

Persistent link: https://www.econbiz.de/10011712718