The Role of Financial Markets in the Transition Process [Paperback]

Financial Markets play an important role in economic development, channeling saving to investments and facilitating growth. In Eastern Europe financial markets were initially much underdeveloped, and lacked the skills and infrastructure they needed to be efficient, having not acquired them in the pre-transition era. The book offers a both theoretical and empirical analysis of financial markets in transitional economies. It investigates financial markets in Hungary, the Czech Republic, and Poland, and their role in the developments in the 1990s.

Financial Markets play an important role in economic development, channeling saving to investments and facilitating growth. In Eastern Europe financial markets were initially much underdeveloped, and lacked the skills and infrastructure they needed to be efficient, having not acquired them in the pre-transition era. The book offers a both theoretical and empirical analysis of financial markets in transitional economies. It investigates financial markets in Hungary, the Czech Republic, and Poland, and their role in the developments in the 1990s.

1 Financial Markets and Transition.- 1.1 Introduction.- 1.2 Theoretical Background.- 1.3 Empirical Evidence.- 1.4 Financial Market Imperfections in Eastern Europe.- 1.5 The Aim of this Volume.- References.- 2 The Order of Financial Liberalisation: Lessons from the Polish Experience.- 2.1 Introduction.- 2.2 Institutions and Sources of Finance.- 2.3 Privatisation, Restructuring and Enterprise Finance.- 2.4 Conclusions.- References.- 3 Economic and Financial Transition in Hungary.- 3.1 Introduction.- 3.2 Macroeconomic Developments and Transition Progress.- 3.3 Financial Developments.- 3.4 Issues in Financial Development.- 3.5 Challenges Ahead.- References.- 4 Endogenous Startups, Financial Conditions, and Capital Accumulation.- 4.1 Introduction.- 4.2 The Basic Model.- 4.3 Public Expenditure Financed by Labor Income Taxes.- 4.4 An Open Economy in a Fixedl#-