The Assessment: Finance, Law, and Growth

Determinants of Financial Development

“…Countries with French Civil Law are said to have comparatively inefficient contract enforcement and higher corruption, and less well-developed financial systems, while countries with a British legal origin achieve higher levels of financial development. Among others, Mayer and Sussman (2001) emphasize that regulations concerning information disclosure, accounting standards, permissible banking practice and deposit insurance do appear to have material effects on financial development. Beck et al (2003)'s application of the settler mortality hypothesis of Acemoglu et al (2001) to financial development is another significant work in this context.…”

Managerial Social Capital and Financial Development: A Cross‐Country Analysis

“…Japelli and Pagano (1999) find that the breadth of credit markets is directly related to the characteristics of the information-sharing mechanisms that reduce information asymmetry. Mayer and Sussman (2001) describe how stricter regulations on information disclosure and accounting standards affect financial development. Benston (1973), Fischel and Grossman (1984), and Miller (1991) show that private stock exchanges reduce information asymmetry by mandating optimal disclosure and monitoring compliance of listed firms, thus encouraging securities market development.…”

Economic and Social Development of the Southern and Eastern Mediterranean Countries

“…In turn, Huang (2010) suggests that institutions, macroeconomics, and geography are the principal factors explaining the difference in FD between countries. He shows that protecting property rights (La Porta et al 1997, enforcing contracts, and maintaining good accounting standards (Mayer and Sussman 2001) are the key factors contributing to financial sector success. In the same vein, argue, based on the interest group theory, that industrial incumbents could block the development of a local financial sector under a scenario of low trade openness.…”