In any economic environment where decisions are decentralized, agents consider the risk that others might unfairly exploit informational asymmetries to their own disadvantage. Incomplete results, especially, lies at the heart of financial transactions in which agents trade real claims for...

Over the past decades, finance theory has contributed significantly to understanding banks and identifying what qualifies them to be special financial intermediaries. Historically, banks have had a comparative advantage in certain functions - such as providing liquidity and payment services and...

The authors report cross-country data on commercial bank regulation and ownership in more than 60 countries. They evaluate the links between different regulatory/ownership practices in those countries and both financial sector performance and banking system stability. They document substantial...

The cost of public investment is not the value of public capital. Unlike for private investors, there is no remotely plausible behavioral model of the government as investor that suggests that every dollar the public sector spends as"investment"creates capital in an economic sense. This...

An understanding of corporate governance theory can promote the adoption of appropriate governance tools to limit agency problems in public pension fund management. The absence of a market for corporate control hinders the translation of lessons from the private sector corporate world to public...

Emergency programs are designed to soften the impact of economic crises-income shocks experienced by an entire community or country-on consumption and human capital accumulation. Of particular concern are poor people: as a result of inadequate savings or inadequate access to credit or insurance...

Many countries compete against one another in attracting foreign investors by offering ever more generous incentive packages and justifying their actions with the productivity gains that are expected to accrue to domestic producers from knowledge externalities generated by foreign affiliates....

The author argues for a shift in the focus of economic analysis of projects. First, project analysts need to make full use of project information, especially identifying the source of the divergence between market prices and economic costs as well as the source of the divergence between economic...

In an economy where decisions are decentralized and made under conditions of uncertainty, the financial system can be seen as the complex of institutions, infrastructure, and instruments that society adopts to minimize the costs of trading promises when agents have incomplete trust and limited...

The early start of the process of bank restructuring and privatization in Hungary provides a longer and richer amount of evidence than that available for any other transition economy. The authors analyze the dynamics of bank restructuring in Hungary with a focus on the role played by foreign...