Why do French civil-law countries have higher levels of financial efficiency?

Simplice Simplice A.
Authors registered in the RePEc Author Service: Simplice A. Asongu

MPRA Paper from University Library of Munich, Germany

Abstract: The dominance of English common-law countries in prospects for financial development in the legal-origins debate has been debunked by recent findings. Using exchange rate regimes and economic/monetary integration oriented hypotheses, this paper proposes an “inflation uncertainty theory” in providing theoretical justification and empirical validity as to why French civil-law countries have higher levels of financial allocation efficiency. Inflation uncertainty, typical of floating exchange rate regimes accounts for the allocation inefficiency of financial intermediary institutions in English common-law countries. As a policy implication, results support the benefits of fixed exchange rate regimes in financial intermediary allocation efficiency.

Keywords: Banking; allocation efficiency; exchange rate; inflation; economic integration (search for similar items in EconPapers)
JEL-codes: D61 G20 K00 P50 R10 (search for similar items in EconPapers)
Date: 2011-10-12
New Economics Papers: this item is included in nep-cis
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (57)

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Related works:
Journal Article: WHY DO FRENCH CIVIL LAW COUNTRIES HAVE HIGHER LEVELS OF FINANCIAL EFFICIENCY (2011)
Working Paper: Why do French civil-law countries have higher levels of financial efficiency? (2011)
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