Enthusiasts for financial sector tax reform typically come either with some form of"flat tax"(including value added tax on financial services, zero taxation on capital income, or a universal transactions tax) or advocating corrective taxes designed to offset market failures or achieve other...

It has recently been proposed that banks be allowed to hold less capital against loans to borrowers who have received a favorable rating by an approved rating agency. But a plausible model of rating-agency behavior shows that this strategy could have perverse results, actually increasing the...

The recent Thai boom has been accomplished in an economy with considerable openness to external forces. Despite the fiscal correction achieved during 1986-89, the domestic demand expansion has made itself felt in a widening of the current account deficit. While this deficit partly reflects the...

This paper is about financial flows in developing countries. It reviews the evidence on who the borrowers and lenders are. Apart from collecting and summarizing available data from some seventeen countries, the paper presents the results of an econometric analysis of the interactions between the...

The authors examine why emerging markets, in particular, are susceptible to and affected by financial difficulties. They show that these difficulties have a richer, more complex structure than they are sometimes believed to have - with marked information asymmetries and substantial volatility....

Current issues in banking policy range from the need to construct basic institutions and incentive structures in transition economies, to the challenges posed by the increasingly complex interactions involved in contemporary banking. The authors of this report outline the basic regulatory...

In the aftermath of a banking crisis, most attention is rightly focused on allocating losses, rebuilding properly managed institutions, and achieving debt recovery. But the authorities'decision to use budgetary funds to help restructure a large failed bank or banking system also has consequences...

The purpose of this study is to set out a practical method for analyzing how inflation, interest ceilings, reserve requirements and like impositions have had tax-like effects and how they can be compared with explicit taxes. Using this method estimates of the varying magnitudes of the total...

Using Principal Components, the authors construct a 25-year time series index of financial liberalization for each of eight developing countries: Chile, Ghana, Indonesia, the Republic of Korea, Malaysia, Mexico, Turkey, and Zimbabwe. They use it in an econometric analysis of private saving in...

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...