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We introduce a banking sector and heterogeneous agents in the Matsuyama et al. (2016) dynamic over-lapping generations neoclassical model with good and bad projects. The model captures the benefits and costs of an advanced banking system which can facilitate economic development when allocates...
Persistent link: https://www.econbiz.de/10013465706
Countries differ on the extent to which their financial system relies on banks or on the financial market. We offer a model featuring a possible two way relationship between countries' financial system architecture and their comparative advantage. Countries specialising in bank dependent sectors...
Persistent link: https://www.econbiz.de/10011492076
Using a panel fixed effects model for a sample of 121 countries covering 1975-2005, we examine how financial development, financial liberalization and banking crises are related to income inequality. In contrast with most previous work, our results suggest that all finance variables increase...
Persistent link: https://www.econbiz.de/10011536253
This paper examines some determinants of banking crises in developing economies. Specifically, the effects of terms of trade shocks and capital flows are analyzed. The choice of the nominal exchange rate regime is found to be a crucial factor in the way various shocks are transmitted through the...
Persistent link: https://www.econbiz.de/10011410637
How exposed is the labour market to ever-advancing AI capabilities, to what extent does this substitute human labour, and how will it affect inequality? We address these questions in a simulation of 711 US occupations classified by the importance and level of cognitive skills. We base our...
Persistent link: https://www.econbiz.de/10015077845
The distribution of health inequalities appears to exhibit a different pattern when samples of developing countries are examined. One explanation is the existence of a health Kuznets ́curve. This paper sets out as an exploratory analysis to test the latter hypothesis of an inverse U shape...
Persistent link: https://www.econbiz.de/10010199440
We examine the impact of various dimensions of financial reform on the likelihood of systemic and non-systemic banking crises. Using new financial reform measures for a large sample of developing and developed countries for the period 1973 to 2002, our multivariate probit modeling results...
Persistent link: https://www.econbiz.de/10003922715
Existing literature sees opportunistic behaviour of contractual partners as the main reason why rational agents underinvest in relationship-specific assets. We look beyond this well-know holdup problem and argue that financial vulnerability and short-term planning horizon can also lead to such...
Persistent link: https://www.econbiz.de/10009010059
We explore the impact of large banks and of financial openness for aggregate growth. Large banks matter because of granular effects: if markets are very concentrated in terms of the size distribution of banks, idiosyncratic shocks at the bank-level do not cancel out in the aggregate but can...
Persistent link: https://www.econbiz.de/10009786228
This paper attempts to reconcile the apparent contradiction between two strands of the literature on the effects of financial intermediation on economic activity. On the one hand, the empirical growth literature finds a positive effect of financial depth as measured by, for instance, private...
Persistent link: https://www.econbiz.de/10011409380