Does Financial Structure Matter in Determining the Effectiveness of Monetary Policy? a Comparison Between Civil-law and Common-law Countries PDF Download

Author: Zukarnain Zakaria
Publisher:
ISBN:
Category : Banks and banking
Languages : en
Pages :

View

Book Description

Author: Board of Governors of the Federal Reserve System
Publisher:
ISBN: 9780894991967
Category : Banks and Banking
Languages : en
Pages : 0

View

Book Description
Provides an in-depth overview of the Federal Reserve System, including information about monetary policy and the economy, the Federal Reserve in the international sphere, supervision and regulation, consumer and community affairs and services offered by Reserve Banks. Contains several appendixes, including a brief explanation of Federal Reserve regulations, a glossary of terms, and a list of additional publications.

Author: O. Emre Ergungor
Publisher:
ISBN:
Category :
Languages : en
Pages : 67

View

Book Description
Why are common-law countries market-dominated and civil-law countries bank-dominated? This paper provides an explanation tied to legal traditions. Civil-law courts have been less effective in resolving conflicts than common-law courts because civil-law judges traditionally refrain from interpreting the codes and creating new rules. Therefore, they are not very effective in extending their reach to matters that are not defined in the laws of the country. In a civil-law environment, where potential conflicts between borrowers and individual lenders inhibit the development of markets because the courts are unable to penalize defrauding borrowers, I show that banks can induce borrowers to honor their obligations by threatening to withhold services that only banks can provide. In other words, banks emerge as the primary contract enforcers in economies where courts are imperfect. Therefore, one would expect the civil-law countries to be bank-dominated. The empirical evidence presented in this paper supports this argument.Legal scholars argue that courts, acting as contract enforcers, need the guidance of laws to settle disputes. However, if there are alternative institutions in an economy, such as banks as described in this paper, that can enforce contracts without court intervention, I conjecture that there is relatively little need for investor rights compared to countries where the courts are the primary contract enforcers. In support of this argument, I show that creditor rights play no role in bank-development in civil-law countries but they promote banking growth in common-law countries where courts are more efficient. This paper also reveals that some of the earlier analyses that used a pooled sample of common-law and civil-law countries to test the effect of investor rights on bank development are misspecified. Therefore, in this analysis, common-law and civil-law countries are analyzed separately.I also show that prevailing economic conditions and legal traditions jointly determine the financial structure of a country. Therefore, although a country's legal tradition is permanent, the organization of its financial system may fluctuate over time between a bank-dominated structure and a market-dominated structure. These results agree with the findings of Rajan and Zingales (2000) who showed that France and Germany were more market-friendly than U.S. and U.K. at the turn of the 20th century.

Author: Michèle Schmiegelow
Publisher: Springer
ISBN: 3642546609
Category : Law
Languages : en
Pages : 490

View

Book Description
This book addresses two countervailing challenges to theory and policy in law and economics. The first is the rise of legal origins theory, which denies the comparative law view of convergence between common law and civil law by the assertion of an economic superiority of common law. The second is the series of economic crises in the very financial markets on which that assertion was based. Both trends unsettled certainties about the rule of law and institutional economics. Meeting legal origins theory in its main areas of political science, sociology and economics, the book extends the interdisciplinary reach to neglected aspects of comparative law, legal history, dynamic econometric analysis and "quasi-natural experiments" with counterfactual evidence of different institutional regimes in divided countries. These combined methodological tools make tests of the economic impact of different legal origins much more reliable. This is shown for developed and newly industrialized countries as well as developing, transforming and emerging countries with or without financial center advantage, affected or not by financial crises. The Asian financial crises and the American subprime crisis have been, or could have been resolved using the resources of common law or civil law. These cases and data on access to justice in Africa, Asia and Latin America reveal the problem of substantive law remaining "law on the books" without efficient procedural rules and judicial structures. The single most striking common law-civil law divide is that lawyer-dominated common law procedure is slower and costlier than judge-managed civil law procedure. Countries as diverse as the Netherlands, Japan, and China show functional interaction between culture and law in legal reforms. Such interaction can reduce the occurrence of legal disputes as well as facilitate their resolution. It can use economic crises as catalysts for legal reforms or rely on regional integration, and it should replace the discredited method of legal "transplants" by sustained dialogue between legal advisors and all actors involved in legal reforms.

Author: Mr.Peter Stella
Publisher: International Monetary Fund
ISBN: 1451850506
Category : Business & Economics
Languages : en
Pages : 40

View

Book Description
Central banks may operate perfectly well without capital as conventionally defined. A large negative net worth, however, is likely to compromise central bank independence and interfere with its ability to attain policy objectives. If society values an independent central bank capable of effectively implementing monetary policy, recapitalization may become essential. Proper accounting practice in determining central bank profit or loss and rules governing the transfer of the central bank’s operating result to the treasury are also important. A variety of country-specific central bank practices are reviewed to support the argument.

Author: Mrs.Sage De Clerck
Publisher: International Monetary Fund
ISBN: 1498379214
Category : Business & Economics
Languages : en
Pages : 470

View

Book Description
The 2007–09 international financial crisis underscored the importance of reliable and timely statistics on the general government and public sectors. Government finance statistics are a basis for fiscal analysis and they play a vital role in developing and monitoring sound fiscal programs and in conducting surveillance of economic policies. The Government Finance Statistics Manual 2014 represents a major step forward in clarifying the standards for compiling and presenting fiscal statistics and strengthens the worldwide effort to improve public sector reporting and transparency.

Author: Wouter Bossu
Publisher: INTERNATIONAL MONETARY FUND
ISBN: 9781513561622
Category : Business & Economics
Languages : en
Pages : 51

View

Book Description
This paper analyzes the legal foundations of central bank digital currency (CBDC) under central bank and monetary law. Absent strong legal foundations, the issuance of CBDC poses legal, financial and reputational risks for central banks. While the appropriate design of the legal framework will up to a degree depend on the design features of the CBDC, some general conclusions can be made. First, most central bank laws do not currently authorize the issuance of CBDC to the general public. Second, from a monetary law perspective, it is not evident that “currency” status can be attributed to CBDC. While the central bank law issue can be solved through rather straithforward law reform, the monetary law issue poses fundmental legal policy challenges.

Author: Asl? Demirgüç-Kunt
Publisher: World Bank Publications
ISBN:
Category : Bancos
Languages : en
Pages : 73

View

Book Description

Author: Wouter Bossu
Publisher: International Monetary Fund
ISBN: 1513580329
Category : Law
Languages : en
Pages : 44

View

Book Description
Well-designed banking laws are critical for regulating the market access and operations of banks, as well as their removal from the market in case of failure. While at a financial policy level there is a broad consensus as to the content of banking laws, from a legal perspective their drafting often leaves something to be desired. In spite of what is often argued, the types of weaknesses of banking laws are hardly country-specific; many weaknesses are shared by many banking laws. This working paper discusses those weaknesses and ways to remedy them, by focusing on a selected set of legal policy principles.

Author: Asli Demirguc-Kunt
Publisher: World Bank Publications
ISBN:
Category : Access to Finance
Languages : en
Pages : 82

View

Book Description
Abstract: The first part of this paper reviews the literature on the relation between finance and growth. The second part of the paper reviews the literature on the historical and policy determinants of financial development. Governments play a central role in shaping the operation of financial systems and the degree to which large segments of the financial system have access to financial services. The paper discusses the relationship between financial sector policies and economic development.