Using bank data for 80 countries for 1988-95, the authors show that differences in interest margins and bank profitability reflect various determinants: bank characteristics, macroeconomic conditions, explicit and implicit bank taxes, regulation of deposit insurance, general financial structure,...

Between 1983 and 1986, Malaysia embarked on a structural adjustment program to control its fiscal and balance of payments deficits. In reaction to the shock of sharply declining commodity prices, the Malaysian government drastically cut back on public spending and allowed the exchange rate to...

The literature on safety nets has become technically more precise by drawing on advances in contract theory and optimal governance structure. This paper begins with a treatment of some aspects of the theory. The author's approach draws more on institutional economics, and more precisely on the...

Banking sectors in transition economies have experienced major transformations throughout the 1990s. While some countries have been successful in eliminating underlying distortions and restructuring their financial sectors, in some cases financial sectors remain underdeveloped and the rates of...

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....

That the financial sector should be liberalized was the orthodox view in the mid-1970s, during a pendulum swing toward reliance on the free market. In the early 1980s, the pendulum swung back to the left, based partly on evidence - especially from Latin America - that overly rapid reform had...

Financial reforms in formerly centrally planned economies take a different form than in market economies because they imply not only liberalizing the system but also reshaping the structure and functioning of financial markets. And the reforms must be designed to facilitate the conduct of...

Since the late 1970s, industrial activity in Greece has been deteriorating rapidly. An increasing number of industrial firms have experienced distress and failure. Because of their extensive indebtedness, the widespread distress of industrial companies has affected the soundness of Greek banks....

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...