Specialization, Intermediation, and Growth.
In market economies financial intermediaries develop during the early stages of industrialization. This paper argues that it occurs because as firms specialize the number of transactions involving credit increases. The main conclusions of the paper are : (a) when increased specialization is a necessary condition for growth, sustained growth may not start if financial intermediaries do not emerge. In this sense, intermediaries are a necessary condition for growth to start and persist; (b) when firms specialize intermediaries endogenously emerge, because they prevent the duplication of monitoring effort. Thus, it is specialization in the real sector which causes the emergence of intermediaries.
Year of publication: |
1996
|
---|---|
Authors: | Galetovic, Alexander |
Institutions: | Centro de EconomÃa Aplicada, Universidad de Chile |
Saved in:
Saved in favorites
Similar items by person
-
Public-Private Partnerships and Infrastructure Provision in the United States
Engel, Eduardo, (2011)
-
Soft budgets and Renegotiations in Public-Private Partnerships
Engel, Eduardo, (2009)
-
Vertical Mergers and Competition with a Regulated Bottleneck Monopoly
Galetovic, Alexander, (2004)
- More ...