Year: 2017
Author: Kotz, Hans-Helmut, Schäfer, Dorothea
Vierteljahrshefte zur Wirtschaftsforschung, Vol. 86 (2017), Iss. 2 : pp. 89–98
Abstract
Compared to the U.S., the euro area has been underperforming in the wake of the Great Financial Crisis (GFC). This holds especially true for peripheral euro area economies. Whereas the U.S. is characterised by a financial system dominated by arms" length (capital-market oriented) interaction between providers and users of funds, in Europe, in many cases, bank intermediation dominates. However, fragile, capital-constrained banks also meant a curtailed supply of funds, an issue especially for bank-dependent small or medium-sized firms (SMEs). Hence, it appears more than evident that easing the access to capital markets (in particular through securitization) should support medium-run growth perspectives, especially in peripheral euro area economies, those worst hit. There might, however, be structural (economic) reasons why SMEs prefer (local) bank relationships. Given substantial underlying idiosyncrasies, placing SME debt, in collateralised form, on capital markets has proven difficult. Finally, the strong emphasis put in the CMU project on disintermediation comes with side-effects. National systems of finance are often part and parcel of an institutional landscape with internal coherence. Reengineering finance is therefore more than a parametric adjustment, calling for political debate.
Journal Article Details
Publisher Name: Global Science Press
Language: English
DOI: https://doi.org/10.3790/vjh.86.2.89
Vierteljahrshefte zur Wirtschaftsforschung, Vol. 86 (2017), Iss. 2 : pp. 89–98
Published online: 2017-06
AMS Subject Headings: Duncker & Humblot, Duncker & Humblot
Copyright: COPYRIGHT: © Global Science Press
Pages: 10
Keywords: Financial system bank-based market-based small and medium-sized firm Capital Markets Union European Union euro area institutional coherence G18 G21 G23 G28 G30 G15
Author Details
-
Diversity across EU banking sectors: Poorly researched and underappreciated
Kotz, Hans-Helmut | Schäfer, DorotheaVierteljahrshefte zur Wirtschaftsforschung, Vol. 87 (2018), Iss. 4 P.153
https://doi.org/10.3790/vjh.87.4.153 [Citations: 0] -
How does banking diversity fit in the general vision inspiring the joint process of Banking Union and Capital Markets Union?
Ferri, Giovanni | Neuberger, DorisVierteljahrshefte zur Wirtschaftsforschung, Vol. 87 (2018), Iss. 4 P.25
https://doi.org/10.3790/vjh.87.4.25 [Citations: 0]