The authors focus on two issues. First they examine whether firms in different countries finance long-term and short term investment similarly. Second, they investigate whether differences in financial systems and legal institutions across countries are reflected in the ability of firms to grow...

The burst of the Japanese financial bubble in the early 1990s has increased the bad debts of Japan's financial institutions. Japan accounts for about 20 percent of foreign aid to developing countries and for 10 percent of their exports, so Japan's economic health is important. The authors...

Before the late 1970s, U.S. savings and loan institutions (S&Ls) were primarily mutually-owned institutions with limited management capabilities, limited investment options, and virtually unlimited interest rate exposure. The industry was closely tied to real estate so conflicts of interest and...

In principle, financial regulation seeks to remedy recognized deficiencies in a nation's economic, political, and bureaucratic incentivestructures. But the social urgency of particular financial policy problems differ according to a country's stage of development. Regulatory strategies that make...

The authors review the case for market-based debt reduction and concerted debt reduction. They explain the new menu-based approach to debt reduction and discuss why it may be preferred to market-based and concerted debt reduction. In a review of the five recent debt-reduction agreements, they...

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 present paper is the product of an effort to systematize some of the state owned enterprise (SOE) data that have become available recently. Part one of the paper begins by examining the role of SOEs on aggregate value added and investment, during the 1980-85 period in developing countries....

The authors review the literature on term finance to place the research in context and discuss its implications for World Bank operations. Their project investigated whether industrial firms in developing countries suffer from a shortage of long-term credit and whether that shortage affects the...

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...

This paper studies the significance of social innovations - in particular, financial and fiscal innovations. Financial innovations tend to reduce transaction costs and risk, and as a result bring about widening, deepening and integration of capital markets. Such financial development accelerates...