Economic Information and Finance [electronic resource] : More Information Means More Credit, Fewer Bad Loans, and Less Corruption / Islam, Roumeen
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TextPublication details: Washington, D.C., The World Bank, 2007Description: 1 online resource (38 p.)Subject(s): Access to Finance | Accounting | Bank lending | Bank Policy | Bankruptcy and Resolution of Financial Distress | Banks and Banking Reform | Debt Markets | Finance and Financial Sector Development | Financial health | Financial Intermediation | Financial sector development | Insurance | Labor markets | Non-performing loans | Private credit | TransparencyAdditional physical formats: Islam, Roumeen.: Economic Information and Finance.Online resources: Click here to access online Abstract: This paper builds on recent work that shows how financial sector outcomes are affected by the provision of information by financial and other entities. In particular, it shows that an indicator of economic transparency is positively related to higher levels of private credit and a lower share of nonperforming loans even after accounting for factors commonly believed to influence financial sector development in cross-country empirical estimation. Timely access to economic data allows investors to make better decisions on investments and to better monitor banks' financial health. Greater economic transparency raises accountability and lowers corruption in bank lending.
This paper builds on recent work that shows how financial sector outcomes are affected by the provision of information by financial and other entities. In particular, it shows that an indicator of economic transparency is positively related to higher levels of private credit and a lower share of nonperforming loans even after accounting for factors commonly believed to influence financial sector development in cross-country empirical estimation. Timely access to economic data allows investors to make better decisions on investments and to better monitor banks' financial health. Greater economic transparency raises accountability and lowers corruption in bank lending.
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