National Preferences for Bank or Market Financing

Raj Aggarwal and John Goodell

Economic Commentary, 2016, issue May

Abstract: This article examines the reasons some countries favor bank-based financial systems and others favor markets-based financial systems. We show that when societies are more accepting of ambiguity?and by extension are more trusting?market financing is favored over relationship-based collateral financing by banks.

Keywords: Financial Systems; Banks; Financing (search for similar items in EconPapers)
Date: 2016
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