The authors investigate the link between
financial crises and industry growth. They analyze data from
19 industrial and developing countries that have experienced
financial crises during the past 30 years to investigate how
financial crises affect sectors dependent on external
sources of finance. Specifically, the authors examine
whether the impact of a financial crisis on externally
dependent sectors varies with the depth of the financial
system. They find that sectors highly dependent on external
finance tend to experience a greater contraction of value
added during a crisis in deeper financial systems than in
countries with shallower financial systems. They hypothesize
that the deepening of the financial system allows sectors
dependent on external finance to obtain relatively more
external funding in normal periods, so a crisis in such
countries would have a disproportionately negative effect on
externally dependent sectors. In contrast, since externally
dependent firms tend to obtain relatively less external
financing in shallower financial systems (and hence have
relatively lower growth rates in such countries during
normal times), a crisis in such countries has less of a
disproportionately negative effect on the growth of
externally dependent sectors.
Bibliographic Details
| Main Authors: |
Laeven, Luc,
Klingebiel, Daniela,
Kroszner, Randy |
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| Format: | Policy Research Working Paper
biblioteca
|
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| Language: | English
en_US |
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| Published: |
World Bank, Washington, D.C.
2002-06-30
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| Subjects: | ADVERSE CONSEQUENCES,
ADVERSE EFFECTS,
BALANCE SHEET,
BALANCE SHEETS,
BANK LENDING,
BANKING CRISES,
BANKING CRISIS,
BONDS,
BUDGET CONSTRAINTS,
CAPITAL EXPENDITURES,
CORPORATE SECTOR,
CREDIT CONSTRAINTS,
CREDIT RATIONING,
CRISES RESOLUTION,
DEPENDENT VARIABLE,
DEPOSIT GUARANTEES,
DEREGULATION,
DEVELOPED COUNTRIES,
DEVELOPING COUNTRIES,
DEVELOPMENT ECONOMICS,
DEVELOPMENT INDICATORS,
ECONOMIC ACTIVITY,
ECONOMIC GROWTH,
ECONOMIC LITERATURE,
ECONOMIC RESEARCH,
EMERGING MARKETS,
EMPIRICAL EVIDENCE,
EMPIRICAL LITERATURE,
EMPIRICAL WORK,
EXCESS LIQUIDITY,
FINANCIAL CRISES,
FINANCIAL CRISIS,
FINANCIAL DATA,
FINANCIAL DEPTH,
FINANCIAL DEVELOPMENT,
FINANCIAL INSTITUTIONS,
FINANCIAL MARKETS,
FINANCIAL RESTRUCTURING,
FINANCIAL SECTOR,
FINANCIAL SERVICES,
FINANCIAL STRUCTURE,
FINANCIAL SYSTEMS,
GDP,
GROWTH PATTERN,
GROWTH RATE,
GROWTH RATES,
GROWTH REGRESSIONS,
HARD BUDGET CONSTRAINTS,
INCOME,
INDUSTRIAL SECTOR,
INFLATION,
LEGAL SYSTEMS,
LIQUIDITY,
M2,
MONETARY POLICY,
NEGATIVE EFFECT,
NEGATIVE IMPACT,
PER CAPITA GROWTH,
POLICY RESEARCH,
POLITICAL ECONOMY,
REAL GDP,
REAL SECTOR,
REGULATORY FORBEARANCE,
SECTOR ACTIVITY,
STANDARD DEVIATION,
TOTAL FACTOR PRODUCTIVITY,
TOTAL FACTOR PRODUCTIVITY GROWTH,
TRANSMISSION OF MONETARY POLICY,
VALUE ADDED,
WORKING CAPITAL FINANCIAL CRISES,
EXTERNAL FINANCE,
FINANCE,
INDUSTRY FINANCE, |
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| Online Access: | http://documents.worldbank.org/curated/en/2002/06/1943366/financial-crises-financial-dependence-industry-growth
http://hdl.handle.net/10986/14285
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