New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?

The authors find no evidence for the superiority of either market-based or bank-based financial systems for industries dependent on external financing. But they find overwhelming evidence that industries heavily dependent on external finance grow faster in economies with higher levels of financial development, and with better legal protection for outside investors - including strong creditor and shareholder rights and strong contract enforcement mechanisms. Financial development also stimulates the establishment of new firms, which is consistent with the Schumpeterian view of creative destruction. Financial development matters. That the financial system is bank-based on market-based offers little additional information.

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Bibliographic Details
Main Authors: Levine, Ross, Beck, Thorsten
Language:English
en_US
Published: World Bank, Washington, DC 2000-06
Subjects:ACCOUNTING STANDARDS, ANNUAL GROWTH, ANNUAL GROWTH RATE, BANK CREDIT, BANKING SECTOR, BANKS, BOARDS OF DIRECTORS, CAPITAL ACCUMULATION, CAPITAL EXPENDITURES, CAPITALIZATION, CASH FLOWS, CIVIL LAW, COMMON LAW, COMPARATIVE ADVANTAGE, COMPARATIVE ADVANTAGES, CONTRACT ENFORCEMENT, CORPORATE PROFITS, COUNTRY DATA, COUNTRY GROWTH REGRESSIONS, COUNTRY VARIATION, DEBT, DEPENDENT VARIABLE, DESCRIPTIVE STATISTICS, ECONOMIC ACTIVITY, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, ECONOMIC PERFORMANCE, EMPIRICAL RESULTS, ENTREPRENEURSHIP, EXTERNAL FINANCE, FINANCIAL DEVELOPMENT, FINANCIAL INTERMEDIARIES, FINANCIAL INTERMEDIATION, FINANCIAL MARKETS, FINANCIAL SECTOR, FINANCIAL SECTOR DEVELOPMENT, FINANCIAL SERVICES, FINANCIAL STRUCTURE, FINANCIAL SYSTEM, FINANCIAL SYSTEMS, FINANCIAL TRANSACTIONS, GDP, GROSS DOMESTIC PRODUCT, GROWTH RATE, GROWTH RATES, INCOME, INDEPENDENT VARIABLES, INSTITUTIONAL DEVELOPMENT, LARGE SHAREHOLDERS, LEGAL ORIGIN, LEGAL SYSTEMS, LIQUID MARKETS, LIQUIDATION, LIQUIDITY, MARKET CAPITALIZATION, NATIONAL OUTPUT, NEGATIVE SIGN, POLICY RESEARCH, PRIVATE CREDIT, PRIVATE SECTOR, REORGANIZATION, RESOURCE ALLOCATION, REVERSE CAUSALITY, RULE OF LAW, SECTOR ACTIVITY, SHAREHOLDERS, SIGNIFICANT IMPACT, STOCK MARKET, STOCK MARKETS, STOCK PRICES, TAKEOVER, TRANSACTION COSTS, TRANSACTIONS COSTS, VALUE ADDED,
Online Access:http://documents.worldbank.org/curated/en/2000/06/437118/new-firm-formation-industry-growth-having-market--or-bank-based-system-matter
https://hdl.handle.net/10986/19840
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spelling dig-okr-10986198402024-08-08T18:11:00Z New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter? Levine, Ross Beck, Thorsten ACCOUNTING STANDARDS ANNUAL GROWTH ANNUAL GROWTH RATE BANK CREDIT BANKING SECTOR BANKS BOARDS OF DIRECTORS CAPITAL ACCUMULATION CAPITAL EXPENDITURES CAPITALIZATION CASH FLOWS CIVIL LAW COMMON LAW COMPARATIVE ADVANTAGE COMPARATIVE ADVANTAGES CONTRACT ENFORCEMENT CORPORATE PROFITS COUNTRY DATA COUNTRY GROWTH REGRESSIONS COUNTRY VARIATION DEBT DEPENDENT VARIABLE DESCRIPTIVE STATISTICS ECONOMIC ACTIVITY ECONOMIC DEVELOPMENT ECONOMIC GROWTH ECONOMIC PERFORMANCE EMPIRICAL RESULTS ENTREPRENEURSHIP EXTERNAL FINANCE FINANCIAL DEVELOPMENT FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIATION FINANCIAL MARKETS FINANCIAL SECTOR FINANCIAL SECTOR DEVELOPMENT FINANCIAL SERVICES FINANCIAL STRUCTURE FINANCIAL SYSTEM FINANCIAL SYSTEMS FINANCIAL TRANSACTIONS GDP GROSS DOMESTIC PRODUCT GROWTH RATE GROWTH RATES INCOME INDEPENDENT VARIABLES INSTITUTIONAL DEVELOPMENT LARGE SHAREHOLDERS LEGAL ORIGIN LEGAL SYSTEMS LIQUID MARKETS LIQUIDATION LIQUIDITY MARKET CAPITALIZATION NATIONAL OUTPUT NEGATIVE SIGN POLICY RESEARCH PRIVATE CREDIT PRIVATE SECTOR REORGANIZATION RESOURCE ALLOCATION REVERSE CAUSALITY RULE OF LAW SECTOR ACTIVITY SHAREHOLDERS SIGNIFICANT IMPACT STOCK MARKET STOCK MARKETS STOCK PRICES TAKEOVER TRANSACTION COSTS TRANSACTIONS COSTS VALUE ADDED The authors find no evidence for the superiority of either market-based or bank-based financial systems for industries dependent on external financing. But they find overwhelming evidence that industries heavily dependent on external finance grow faster in economies with higher levels of financial development, and with better legal protection for outside investors - including strong creditor and shareholder rights and strong contract enforcement mechanisms. Financial development also stimulates the establishment of new firms, which is consistent with the Schumpeterian view of creative destruction. Financial development matters. That the financial system is bank-based on market-based offers little additional information. 2014-08-28T18:49:36Z 2014-08-28T18:49:36Z 2000-06 http://documents.worldbank.org/curated/en/2000/06/437118/new-firm-formation-industry-growth-having-market--or-bank-based-system-matter https://hdl.handle.net/10986/19840 English en_US Policy Research Working Paper;No. 2383 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ application/pdf text/plain World Bank, Washington, DC
institution Banco Mundial
collection DSpace
country Estados Unidos
countrycode US
component Bibliográfico
access En linea
databasecode dig-okr
tag biblioteca
region America del Norte
libraryname Biblioteca del Banco Mundial
language English
en_US
topic ACCOUNTING STANDARDS
ANNUAL GROWTH
ANNUAL GROWTH RATE
BANK CREDIT
BANKING SECTOR
BANKS
BOARDS OF DIRECTORS
CAPITAL ACCUMULATION
CAPITAL EXPENDITURES
CAPITALIZATION
CASH FLOWS
CIVIL LAW
COMMON LAW
COMPARATIVE ADVANTAGE
COMPARATIVE ADVANTAGES
CONTRACT ENFORCEMENT
CORPORATE PROFITS
COUNTRY DATA
COUNTRY GROWTH REGRESSIONS
COUNTRY VARIATION
DEBT
DEPENDENT VARIABLE
DESCRIPTIVE STATISTICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC PERFORMANCE
EMPIRICAL RESULTS
ENTREPRENEURSHIP
EXTERNAL FINANCE
FINANCIAL DEVELOPMENT
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIATION
FINANCIAL MARKETS
FINANCIAL SECTOR
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FINANCIAL TRANSACTIONS
GDP
GROSS DOMESTIC PRODUCT
GROWTH RATE
GROWTH RATES
INCOME
INDEPENDENT VARIABLES
INSTITUTIONAL DEVELOPMENT
LARGE SHAREHOLDERS
LEGAL ORIGIN
LEGAL SYSTEMS
LIQUID MARKETS
LIQUIDATION
LIQUIDITY
MARKET CAPITALIZATION
NATIONAL OUTPUT
NEGATIVE SIGN
POLICY RESEARCH
PRIVATE CREDIT
PRIVATE SECTOR
REORGANIZATION
RESOURCE ALLOCATION
REVERSE CAUSALITY
RULE OF LAW
SECTOR ACTIVITY
SHAREHOLDERS
SIGNIFICANT IMPACT
STOCK MARKET
STOCK MARKETS
STOCK PRICES
TAKEOVER
TRANSACTION COSTS
TRANSACTIONS COSTS
VALUE ADDED
ACCOUNTING STANDARDS
ANNUAL GROWTH
ANNUAL GROWTH RATE
BANK CREDIT
BANKING SECTOR
BANKS
BOARDS OF DIRECTORS
CAPITAL ACCUMULATION
CAPITAL EXPENDITURES
CAPITALIZATION
CASH FLOWS
CIVIL LAW
COMMON LAW
COMPARATIVE ADVANTAGE
COMPARATIVE ADVANTAGES
CONTRACT ENFORCEMENT
CORPORATE PROFITS
COUNTRY DATA
COUNTRY GROWTH REGRESSIONS
COUNTRY VARIATION
DEBT
DEPENDENT VARIABLE
DESCRIPTIVE STATISTICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC PERFORMANCE
EMPIRICAL RESULTS
ENTREPRENEURSHIP
EXTERNAL FINANCE
FINANCIAL DEVELOPMENT
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIATION
FINANCIAL MARKETS
FINANCIAL SECTOR
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FINANCIAL TRANSACTIONS
GDP
GROSS DOMESTIC PRODUCT
GROWTH RATE
GROWTH RATES
INCOME
INDEPENDENT VARIABLES
INSTITUTIONAL DEVELOPMENT
LARGE SHAREHOLDERS
LEGAL ORIGIN
LEGAL SYSTEMS
LIQUID MARKETS
LIQUIDATION
LIQUIDITY
MARKET CAPITALIZATION
NATIONAL OUTPUT
NEGATIVE SIGN
POLICY RESEARCH
PRIVATE CREDIT
PRIVATE SECTOR
REORGANIZATION
RESOURCE ALLOCATION
REVERSE CAUSALITY
RULE OF LAW
SECTOR ACTIVITY
SHAREHOLDERS
SIGNIFICANT IMPACT
STOCK MARKET
STOCK MARKETS
STOCK PRICES
TAKEOVER
TRANSACTION COSTS
TRANSACTIONS COSTS
VALUE ADDED
spellingShingle ACCOUNTING STANDARDS
ANNUAL GROWTH
ANNUAL GROWTH RATE
BANK CREDIT
BANKING SECTOR
BANKS
BOARDS OF DIRECTORS
CAPITAL ACCUMULATION
CAPITAL EXPENDITURES
CAPITALIZATION
CASH FLOWS
CIVIL LAW
COMMON LAW
COMPARATIVE ADVANTAGE
COMPARATIVE ADVANTAGES
CONTRACT ENFORCEMENT
CORPORATE PROFITS
COUNTRY DATA
COUNTRY GROWTH REGRESSIONS
COUNTRY VARIATION
DEBT
DEPENDENT VARIABLE
DESCRIPTIVE STATISTICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC PERFORMANCE
EMPIRICAL RESULTS
ENTREPRENEURSHIP
EXTERNAL FINANCE
FINANCIAL DEVELOPMENT
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIATION
FINANCIAL MARKETS
FINANCIAL SECTOR
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FINANCIAL TRANSACTIONS
GDP
GROSS DOMESTIC PRODUCT
GROWTH RATE
GROWTH RATES
INCOME
INDEPENDENT VARIABLES
INSTITUTIONAL DEVELOPMENT
LARGE SHAREHOLDERS
LEGAL ORIGIN
LEGAL SYSTEMS
LIQUID MARKETS
LIQUIDATION
LIQUIDITY
MARKET CAPITALIZATION
NATIONAL OUTPUT
NEGATIVE SIGN
POLICY RESEARCH
PRIVATE CREDIT
PRIVATE SECTOR
REORGANIZATION
RESOURCE ALLOCATION
REVERSE CAUSALITY
RULE OF LAW
SECTOR ACTIVITY
SHAREHOLDERS
SIGNIFICANT IMPACT
STOCK MARKET
STOCK MARKETS
STOCK PRICES
TAKEOVER
TRANSACTION COSTS
TRANSACTIONS COSTS
VALUE ADDED
ACCOUNTING STANDARDS
ANNUAL GROWTH
ANNUAL GROWTH RATE
BANK CREDIT
BANKING SECTOR
BANKS
BOARDS OF DIRECTORS
CAPITAL ACCUMULATION
CAPITAL EXPENDITURES
CAPITALIZATION
CASH FLOWS
CIVIL LAW
COMMON LAW
COMPARATIVE ADVANTAGE
COMPARATIVE ADVANTAGES
CONTRACT ENFORCEMENT
CORPORATE PROFITS
COUNTRY DATA
COUNTRY GROWTH REGRESSIONS
COUNTRY VARIATION
DEBT
DEPENDENT VARIABLE
DESCRIPTIVE STATISTICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC PERFORMANCE
EMPIRICAL RESULTS
ENTREPRENEURSHIP
EXTERNAL FINANCE
FINANCIAL DEVELOPMENT
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIATION
FINANCIAL MARKETS
FINANCIAL SECTOR
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FINANCIAL TRANSACTIONS
GDP
GROSS DOMESTIC PRODUCT
GROWTH RATE
GROWTH RATES
INCOME
INDEPENDENT VARIABLES
INSTITUTIONAL DEVELOPMENT
LARGE SHAREHOLDERS
LEGAL ORIGIN
LEGAL SYSTEMS
LIQUID MARKETS
LIQUIDATION
LIQUIDITY
MARKET CAPITALIZATION
NATIONAL OUTPUT
NEGATIVE SIGN
POLICY RESEARCH
PRIVATE CREDIT
PRIVATE SECTOR
REORGANIZATION
RESOURCE ALLOCATION
REVERSE CAUSALITY
RULE OF LAW
SECTOR ACTIVITY
SHAREHOLDERS
SIGNIFICANT IMPACT
STOCK MARKET
STOCK MARKETS
STOCK PRICES
TAKEOVER
TRANSACTION COSTS
TRANSACTIONS COSTS
VALUE ADDED
Levine, Ross
Beck, Thorsten
New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
description The authors find no evidence for the superiority of either market-based or bank-based financial systems for industries dependent on external financing. But they find overwhelming evidence that industries heavily dependent on external finance grow faster in economies with higher levels of financial development, and with better legal protection for outside investors - including strong creditor and shareholder rights and strong contract enforcement mechanisms. Financial development also stimulates the establishment of new firms, which is consistent with the Schumpeterian view of creative destruction. Financial development matters. That the financial system is bank-based on market-based offers little additional information.
topic_facet ACCOUNTING STANDARDS
ANNUAL GROWTH
ANNUAL GROWTH RATE
BANK CREDIT
BANKING SECTOR
BANKS
BOARDS OF DIRECTORS
CAPITAL ACCUMULATION
CAPITAL EXPENDITURES
CAPITALIZATION
CASH FLOWS
CIVIL LAW
COMMON LAW
COMPARATIVE ADVANTAGE
COMPARATIVE ADVANTAGES
CONTRACT ENFORCEMENT
CORPORATE PROFITS
COUNTRY DATA
COUNTRY GROWTH REGRESSIONS
COUNTRY VARIATION
DEBT
DEPENDENT VARIABLE
DESCRIPTIVE STATISTICS
ECONOMIC ACTIVITY
ECONOMIC DEVELOPMENT
ECONOMIC GROWTH
ECONOMIC PERFORMANCE
EMPIRICAL RESULTS
ENTREPRENEURSHIP
EXTERNAL FINANCE
FINANCIAL DEVELOPMENT
FINANCIAL INTERMEDIARIES
FINANCIAL INTERMEDIATION
FINANCIAL MARKETS
FINANCIAL SECTOR
FINANCIAL SECTOR DEVELOPMENT
FINANCIAL SERVICES
FINANCIAL STRUCTURE
FINANCIAL SYSTEM
FINANCIAL SYSTEMS
FINANCIAL TRANSACTIONS
GDP
GROSS DOMESTIC PRODUCT
GROWTH RATE
GROWTH RATES
INCOME
INDEPENDENT VARIABLES
INSTITUTIONAL DEVELOPMENT
LARGE SHAREHOLDERS
LEGAL ORIGIN
LEGAL SYSTEMS
LIQUID MARKETS
LIQUIDATION
LIQUIDITY
MARKET CAPITALIZATION
NATIONAL OUTPUT
NEGATIVE SIGN
POLICY RESEARCH
PRIVATE CREDIT
PRIVATE SECTOR
REORGANIZATION
RESOURCE ALLOCATION
REVERSE CAUSALITY
RULE OF LAW
SECTOR ACTIVITY
SHAREHOLDERS
SIGNIFICANT IMPACT
STOCK MARKET
STOCK MARKETS
STOCK PRICES
TAKEOVER
TRANSACTION COSTS
TRANSACTIONS COSTS
VALUE ADDED
author Levine, Ross
Beck, Thorsten
author_facet Levine, Ross
Beck, Thorsten
author_sort Levine, Ross
title New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
title_short New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
title_full New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
title_fullStr New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
title_full_unstemmed New Firm Formation and Industry Growth : Does Having a Market- or Bank-Based System Matter?
title_sort new firm formation and industry growth : does having a market- or bank-based system matter?
publisher World Bank, Washington, DC
publishDate 2000-06
url http://documents.worldbank.org/curated/en/2000/06/437118/new-firm-formation-industry-growth-having-market--or-bank-based-system-matter
https://hdl.handle.net/10986/19840
work_keys_str_mv AT levineross newfirmformationandindustrygrowthdoeshavingamarketorbankbasedsystemmatter
AT beckthorsten newfirmformationandindustrygrowthdoeshavingamarketorbankbasedsystemmatter
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