How to order
IMF Publications

Related material:
The IMF and the Fight Against Money Laundering and the Financing of Terrorism--A Factsheet

Working Papers in full text
2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 All


Other research-related activities and publications of the IMF can be found at IMF Research

Free Email Notification

Receive emails when we post new items of interest to you.

Subscribe or Modify your profile



Finance in Lower Income Countries: An Empirical Exploration

Author/Editor: Detragiache, Enrica | Gupta, Poonam | Tressel, Thierry
Authorized for Distribution: August 1, 2005
Electronic Access: Free Full Text (PDF file size is 432KB)
Use the free Adobe Acrobat Reader to view this PDF file.
 
Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.

Summary: This paper considers how a comprehensive set of factors relates to financial sector performance in low-income countries (LICs). It finds that corruption and inflation are associated with a shallower and less efficient financial system, while legal origin and characteristics of the supervisory and regulatory framework have no significant relationship with performance. Moreover, better contract enforcement and information about borrowers are associated with more private sector credit. Some results are surprising. Countries with more foreign bank penetration seem to have shallower and not necessarily more efficient financial sectors, while a larger presence of state-owned banks is correlated with more bank deposits and lower overhead costs, even after controlling for market size and concentration. Although these relationships are robust, more research is needed to ascertain the direction of causality and identify channels of transmission before deriving policy implications.
 
Order a print copy
Series: Working Paper No. 05/167
Subject(s): Corruption | Economic models | Financial sector | Financial systems | Inflation | Low-income developing countries
Author's keyword(s): Financial development | low income countries
 
English  
    Published:   August 1, 2005        
    ISBN/ISSN:   1934-7073   Format:   Paper
    Stock No:   WPIEA2005167   Pages:   49
    Price:   US$15.00 (Academic Rate: US$15.00 )
       
     
Please address any questions about this title to publications@imf.org.