The upper-income, advanced industrial countries of the world today all have market economies with open competition, competitive multi-party democratic political systems, and a secure government monopoly over violence. Such open access orders, however, are not the only norm and equilibrium type...

Systematic information on household financial asset holdings in developing countries is very sparse. The author reviews some available data and current policy debates. Although financial asset holdings by households are highly concentrated, deeper financial systems are correlated with improved...

Firms often cite financing constraints as one of their primary obstacles to investment. Global capital flows, by bringing in scarce capital, may ease the financing constraints of host country firms. But if incoming foreign investors borrow heavily from domestic banks, foreign direct investment...

The international development community has been grappling with the challenges of implementing development programs and, consequently, with the design of practical approaches to attaining program objectives. This paper contributes to the emerging discussion on addressing the implementation...

Workers' remittances to developing countries have become the second largest type of flows after foreign direct investment. The authors use data on workers' remittance flows to 99 developing countries from 1975-2003 to study the impact of remittances on financial sector development. In...

Using cross-country and panel regressions, the authors show that financial sector development significantly reduces undernourishment (hunger), largely through gaining farmers and others access to productivity-enhancing equipment, translating into beneficial income and general effects. They show...

Using a new database of World Bank loans to support financial sector development, the authors investigate whether countries that received such loans experienced more rapid growth on standard indicators of financial development than countries that did not. They account for self-selection with...

The causal link between finance and growth is one of the most striking empirical macroeconomic relationships uncovered in the past decade. As this branch of the literature matures, the focus shifts from growth to other aspects of economic prosperity, and from financial depth to multidimensional...

Development economics in its early years created the image of a fierce fight between advocates of contrasting theories or approaches- "balanced growth" vs. "unbalanced growth" or "program loans" vs. "project loans." This view has the merit to highlight such conflicts in great detail; yet it...

This paper presents a model of global liquidity shortages. Liquid claims are enforceable promises that play a transaction role. Since developed economies have a comparative advantage in creating liquidity, they export liquid claims to emerging economies, resulting in a permanent current account...