This paper examines the historical origins of the bank-based financial systems in Germany and Japan and the market-based financial system in the US. It critically examines the "timing of industrialization" (TOI) thesis, i.e. the assertion that variation in the current structure of financial...

Most recent discussion of the relationship between the banking system and macroeconomic performance have focused on the deegree of independence of the central bank as the key variable influencing the choice between inflation and unemployment. This paper argues that the stability of the financial...