Financial institutions intermediate between savers and investors and contribute to corporate governance. Equity and bond markets in the former centrally planned economies are not yet in a position adequately to provide these services. It is not yet clear that investment funds will provide the...

Since the early eighties volatility of GDP and inflation has been declining steadily in many countries. Financial innovation has been identified as one of the key factors driving this „Great Moderation‟. Financial innovation was considered to have improved significantly the allocation and...