AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE

This paper seeks to provide a theoretical explanation for the weak association between measures of financial structure—as defined by the mixture of bank-based and market-based financial systems in an economy—and economic development. Lenders fund risky investment projects of firms by drawing up loan...

Full description

Saved in:
Bibliographic Details
Published in:Macroeconomic dynamics 2015-03, Vol.19 (2), p.270-287
Main Authors: Bose, Niloy, Neumann, Rebecca
Format: Article
Language:English
Subjects:
Capital structure
Economic development
Economic models
Economic statistics
Economic theory
Equity
GDP
Global economy
Gross Domestic Product
Industrialized nations
International
Low income groups
Macroeconomics
Overhead costs
Per capita
Securities markets
Stock exchanges
Studies
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
cited_by cdi_FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3
cites cdi_FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3
container_end_page 287
container_issue 2
container_start_page 270
container_title Macroeconomic dynamics
container_volume 19
creator Bose, Niloy
Neumann, Rebecca
description This paper seeks to provide a theoretical explanation for the weak association between measures of financial structure—as defined by the mixture of bank-based and market-based financial systems in an economy—and economic development. Lenders fund risky investment projects of firms by drawing up loan contracts in the presence of an informational asymmetry. An optimal contract entails the issue of debt, equity, or a mix of the two. The equilibrium choice of contract and the financial structure depend on the state of the economy, which in turn depends on the contracting regime. Based on this analysis, the paper provides a theory that can explain the wide diversity of financial structure among middle-income countries.
doi_str_mv 10.1017/S1365100513000382
format article
fullrecord <record><control><sourceid>proquest_cross</sourceid><recordid>TN_cdi_proquest_journals_1662391938</recordid><sourceformat>XML</sourceformat><sourcesystem>PC</sourcesystem><cupid>10_1017_S1365100513000382</cupid><sourcerecordid>3621337141</sourcerecordid><originalsourceid>FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3</originalsourceid><addsrcrecordid>eNp1kE9Lw0AUxBdRsFY_gLcFz9H3stnt7jHExAZCImkqegrZP5UWa-umPfjtTWkPgnh6AzO_eTCE3CLcI-DkYYZMcATgyACAyfCMjDASKpDAxfmgBzs4-Jfkqu9XAChYqEZkEpc0fX0u4jJu8qqkWVXTZprSx_wlrWd580arjGZ5GZdJHhd01tTzpJnX6TW5WHQfvbs53TGZZ2mTTIOiesqTuAgMk7gLpGKR5BFXBpUxErTmxigNXC-EUFYI22kEJSKYWKmkdVaHArRwCkPttGVjcnfs3frN1971u3a12fvP4WWLQoRMoWJySOExZfym771btFu_XHf-u0VoD_u0f_YZGHZiurX2S_vuflX_S_0AUctgZg</addsrcrecordid><sourcetype>Aggregation Database</sourcetype><iscdi>true</iscdi><recordtype>article</recordtype><pqid>1662391938</pqid></control><display><type>article</type><title>AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE</title><source>EconLit s plnými texty</source><source>Cambridge Journals Online</source><source>ABI/INFORM Global</source><creator>Bose, Niloy ; Neumann, Rebecca</creator><creatorcontrib>Bose, Niloy ; Neumann, Rebecca</creatorcontrib><description>This paper seeks to provide a theoretical explanation for the weak association between measures of financial structure—as defined by the mixture of bank-based and market-based financial systems in an economy—and economic development. Lenders fund risky investment projects of firms by drawing up loan contracts in the presence of an informational asymmetry. An optimal contract entails the issue of debt, equity, or a mix of the two. The equilibrium choice of contract and the financial structure depend on the state of the economy, which in turn depends on the contracting regime. Based on this analysis, the paper provides a theory that can explain the wide diversity of financial structure among middle-income countries.</description><identifier>ISSN: 1365-1005</identifier><identifier>EISSN: 1469-8056</identifier><identifier>DOI: 10.1017/S1365100513000382</identifier><language>eng</language><publisher>New York, USA: Cambridge University Press</publisher><subject>Capital structure ; Economic development ; Economic models ; Economic statistics ; Economic theory ; Equity ; GDP ; Global economy ; Gross Domestic Product ; Industrialized nations ; International ; Low income groups ; Macroeconomics ; Overhead costs ; Per capita ; Securities markets ; Stock exchanges ; Studies</subject><ispartof>Macroeconomic dynamics, 2015-03, Vol.19 (2), p.270-287</ispartof><rights>Copyright © Cambridge University Press 2013</rights><lds50>peer_reviewed</lds50><woscitedreferencessubscribed>false</woscitedreferencessubscribed><citedby>FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3</citedby><cites>FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3</cites></display><links><openurl>$$Topenurl_article</openurl><openurlfulltext>$$Topenurlfull_article</openurlfulltext><thumbnail>$$Tsyndetics_thumb_exl</thumbnail><linktopdf>$$Uhttps://www.proquest.com/docview/1662391938/fulltextPDF?pq-origsite=primo$$EPDF$$P50$$Gproquest$$H</linktopdf><linktohtml>$$Uhttps://www.proquest.com/docview/1662391938?pq-origsite=primo$$EHTML$$P50$$Gproquest$$H</linktohtml><link.rule.ids>314,780,784,11688,27924,27925,36060,44363,72960,74895</link.rule.ids></links><search><creatorcontrib>Bose, Niloy</creatorcontrib><creatorcontrib>Neumann, Rebecca</creatorcontrib><title>AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE</title><title>Macroeconomic dynamics</title><addtitle>Macroecon. Dynam</addtitle><description>This paper seeks to provide a theoretical explanation for the weak association between measures of financial structure—as defined by the mixture of bank-based and market-based financial systems in an economy—and economic development. Lenders fund risky investment projects of firms by drawing up loan contracts in the presence of an informational asymmetry. An optimal contract entails the issue of debt, equity, or a mix of the two. The equilibrium choice of contract and the financial structure depend on the state of the economy, which in turn depends on the contracting regime. Based on this analysis, the paper provides a theory that can explain the wide diversity of financial structure among middle-income countries.</description><subject>Capital structure</subject><subject>Economic development</subject><subject>Economic models</subject><subject>Economic statistics</subject><subject>Economic theory</subject><subject>Equity</subject><subject>GDP</subject><subject>Global economy</subject><subject>Gross Domestic Product</subject><subject>Industrialized nations</subject><subject>International</subject><subject>Low income groups</subject><subject>Macroeconomics</subject><subject>Overhead costs</subject><subject>Per capita</subject><subject>Securities markets</subject><subject>Stock exchanges</subject><subject>Studies</subject><issn>1365-1005</issn><issn>1469-8056</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2015</creationdate><recordtype>article</recordtype><sourceid>M0C</sourceid><recordid>eNp1kE9Lw0AUxBdRsFY_gLcFz9H3stnt7jHExAZCImkqegrZP5UWa-umPfjtTWkPgnh6AzO_eTCE3CLcI-DkYYZMcATgyACAyfCMjDASKpDAxfmgBzs4-Jfkqu9XAChYqEZkEpc0fX0u4jJu8qqkWVXTZprSx_wlrWd580arjGZ5GZdJHhd01tTzpJnX6TW5WHQfvbs53TGZZ2mTTIOiesqTuAgMk7gLpGKR5BFXBpUxErTmxigNXC-EUFYI22kEJSKYWKmkdVaHArRwCkPttGVjcnfs3frN1971u3a12fvP4WWLQoRMoWJySOExZfym771btFu_XHf-u0VoD_u0f_YZGHZiurX2S_vuflX_S_0AUctgZg</recordid><startdate>20150301</startdate><enddate>20150301</enddate><creator>Bose, Niloy</creator><creator>Neumann, Rebecca</creator><general>Cambridge University Press</general><scope>AAYXX</scope><scope>CITATION</scope><scope>0U~</scope><scope>1-H</scope><scope>3V.</scope><scope>7WY</scope><scope>7WZ</scope><scope>7XB</scope><scope>87Z</scope><scope>8FK</scope><scope>8FL</scope><scope>8G5</scope><scope>ABUWG</scope><scope>AFKRA</scope><scope>AZQEC</scope><scope>BENPR</scope><scope>BEZIV</scope><scope>CCPQU</scope><scope>DWQXO</scope><scope>FRNLG</scope><scope>F~G</scope><scope>GNUQQ</scope><scope>GUQSH</scope><scope>K60</scope><scope>K6~</scope><scope>L.-</scope><scope>L.0</scope><scope>M0C</scope><scope>M2O</scope><scope>MBDVC</scope><scope>PQBIZ</scope><scope>PQBZA</scope><scope>PQEST</scope><scope>PQQKQ</scope><scope>PQUKI</scope><scope>Q9U</scope></search><sort><creationdate>20150301</creationdate><title>AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE</title><author>Bose, Niloy ; Neumann, Rebecca</author></sort><facets><frbrtype>5</frbrtype><frbrgroupid>cdi_FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3</frbrgroupid><rsrctype>articles</rsrctype><prefilter>articles</prefilter><language>eng</language><creationdate>2015</creationdate><topic>Capital structure</topic><topic>Economic development</topic><topic>Economic models</topic><topic>Economic statistics</topic><topic>Economic theory</topic><topic>Equity</topic><topic>GDP</topic><topic>Global economy</topic><topic>Gross Domestic Product</topic><topic>Industrialized nations</topic><topic>International</topic><topic>Low income groups</topic><topic>Macroeconomics</topic><topic>Overhead costs</topic><topic>Per capita</topic><topic>Securities markets</topic><topic>Stock exchanges</topic><topic>Studies</topic><toplevel>peer_reviewed</toplevel><toplevel>online_resources</toplevel><creatorcontrib>Bose, Niloy</creatorcontrib><creatorcontrib>Neumann, Rebecca</creatorcontrib><collection>CrossRef</collection><collection>Global News &amp; ABI/Inform Professional</collection><collection>Trade PRO</collection><collection>ProQuest Central (Corporate)</collection><collection>ABI/INFORM Collection</collection><collection>ABI/INFORM Global (PDF only)</collection><collection>ProQuest Central (purchase pre-March 2016)</collection><collection>ABI/INFORM Global (Alumni Edition)</collection><collection>ProQuest Central (Alumni) (purchase pre-March 2016)</collection><collection>ABI/INFORM Collection (Alumni Edition)</collection><collection>Research Library (Alumni Edition)</collection><collection>ProQuest Central (Alumni)</collection><collection>ProQuest Central</collection><collection>ProQuest Central Essentials</collection><collection>AUTh Library subscriptions: ProQuest Central</collection><collection>ProQuest Business Premium Collection</collection><collection>ProQuest One Community College</collection><collection>ProQuest Central</collection><collection>Business Premium Collection (Alumni)</collection><collection>ABI/INFORM Global (Corporate)</collection><collection>ProQuest Central Student</collection><collection>Research Library Prep</collection><collection>ProQuest Business Collection (Alumni Edition)</collection><collection>ProQuest Business Collection</collection><collection>ABI/INFORM Professional Advanced</collection><collection>ABI/INFORM Professional Standard</collection><collection>ABI/INFORM Global</collection><collection>ProQuest Research Library</collection><collection>Research Library (Corporate)</collection><collection>ProQuest One Business</collection><collection>ProQuest One Business (Alumni)</collection><collection>ProQuest One Academic Eastern Edition (DO NOT USE)</collection><collection>ProQuest One Academic</collection><collection>ProQuest One Academic UKI Edition</collection><collection>ProQuest Central Basic</collection><jtitle>Macroeconomic dynamics</jtitle></facets><delivery><delcategory>Remote Search Resource</delcategory><fulltext>fulltext</fulltext></delivery><addata><au>Bose, Niloy</au><au>Neumann, Rebecca</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE</atitle><jtitle>Macroeconomic dynamics</jtitle><addtitle>Macroecon. Dynam</addtitle><date>2015-03-01</date><risdate>2015</risdate><volume>19</volume><issue>2</issue><spage>270</spage><epage>287</epage><pages>270-287</pages><issn>1365-1005</issn><eissn>1469-8056</eissn><abstract>This paper seeks to provide a theoretical explanation for the weak association between measures of financial structure—as defined by the mixture of bank-based and market-based financial systems in an economy—and economic development. Lenders fund risky investment projects of firms by drawing up loan contracts in the presence of an informational asymmetry. An optimal contract entails the issue of debt, equity, or a mix of the two. The equilibrium choice of contract and the financial structure depend on the state of the economy, which in turn depends on the contracting regime. Based on this analysis, the paper provides a theory that can explain the wide diversity of financial structure among middle-income countries.</abstract><cop>New York, USA</cop><pub>Cambridge University Press</pub><doi>10.1017/S1365100513000382</doi><tpages>18</tpages></addata></record>
fulltext fulltext
identifier ISSN: 1365-1005
ispartof Macroeconomic dynamics, 2015-03, Vol.19 (2), p.270-287
issn 1365-1005
1469-8056
language eng
recordid cdi_proquest_journals_1662391938
source EconLit s plnými texty; Cambridge Journals Online; ABI/INFORM Global
subjects Capital structure
Economic development
Economic models
Economic statistics
Economic theory
Equity
GDP
Global economy
Gross Domestic Product
Industrialized nations
International
Low income groups
Macroeconomics
Overhead costs
Per capita
Securities markets
Stock exchanges
Studies
title AN EXPLANATION FOR THE DIVERSITY OF FINANCIAL STRUCTURE
url http://sfxeu10.hosted.exlibrisgroup.com/loughborough?ctx_ver=Z39.88-2004&ctx_enc=info:ofi/enc:UTF-8&ctx_tim=2025-01-01T22%3A35%3A03IST&url_ver=Z39.88-2004&url_ctx_fmt=infofi/fmt:kev:mtx:ctx&rfr_id=info:sid/primo.exlibrisgroup.com:primo3-Article-proquest_cross&rft_val_fmt=info:ofi/fmt:kev:mtx:journal&rft.genre=article&rft.atitle=AN%20EXPLANATION%20FOR%20THE%20DIVERSITY%20OF%20FINANCIAL%20STRUCTURE&rft.jtitle=Macroeconomic%20dynamics&rft.au=Bose,%20Niloy&rft.date=2015-03-01&rft.volume=19&rft.issue=2&rft.spage=270&rft.epage=287&rft.pages=270-287&rft.issn=1365-1005&rft.eissn=1469-8056&rft_id=info:doi/10.1017/S1365100513000382&rft_dat=%3Cproquest_cross%3E3621337141%3C/proquest_cross%3E%3Cgrp_id%3Ecdi_FETCH-LOGICAL-c381t-893485459c19cc80bb5cc9b05bf669d66dab1096407d898dedb260b6e912bebd3%3C/grp_id%3E%3Coa%3E%3C/oa%3E%3Curl%3E%3C/url%3E&rft_id=info:oai/&rft_pqid=1662391938&rft_id=info:pmid/&rft_cupid=10_1017_S1365100513000382&rfr_iscdi=true