Geography, Institutions and Principles. Bits and Pieces of Empirical Evidence from Small-scale Banking

Franz Hahn

No 392, WIFO Working Papers from WIFO

Abstract: Theory suggests that the cross-border bank lending flow from rich countries to poor countries is facilitated when lending-related legal and social norms are shared and valued equally by both lenders and borrowers. According to this reasoning the fast adoption of Western-style democracy and market economy principles as established by EU standards by many of the East European "transformation countries" since the early 1990s should have raised cross-border lending by banks based in EU 15 countries to clients resident in new East European EU member countries. Exploring cross-border lending activities of Austrian small- to medium-sized regional banks over the period from 1995 to 2008 with panel and spatial econometric techniques this paper provides evidence that is supportive of this presumption.

Keywords: cross-border bank lending; institutions; neoclassical economics; panel econometric analysis; spatial econometric analysis (search for similar items in EconPapers)
Pages: 27 pages
Date: 2011-04
New Economics Papers: this item is included in nep-geo, nep-tra and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:wfo:wpaper:y:2011:i:392

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