Using a dynamic panel model for more than 15 000 banks from 148 countries from 1988 to 2010, we investigate the interaction between size, growth and profitability of banks. For our total sample, we cannot reject the hypotheses that the variability of bank profitability and the level and...

Many distinguish between financial systems with a dominant role for banks and those with a dominant role for financial markets, assuming this is of great importance for economic development. The author analyses why the distinction might matter, first by investigating how bank and market finance...