In this paper, we examine whether the imperfections in the credit market spill over to the labor market. We examine the case of a country that experienced a very high degree of imperfections in the financial markets, but underwent substantial changes in 1992 due to the liberalization brought by the European unification and other institutional changes. Italy is therefore a good laboratory to stu...

Liberalization is not a spontaneous process the outcome which should be accepted as inevitable as if it is a destiny. On the contrary, liberalization should be considered as a problem of designing an economic mechanism and finding the most appropriate transition path for the economy, under specific environmental conditions. Within this framework one can distinguish well versus ill designed prog...

This Working Paper series presents papers in a preliminary form and serves to stimulate comment and discussion. The views expressed are entirely the author's own and not that of the Institute of Defence and Strategic Studies. The Institute of Defence and Strategic Studies (IDSS) was established in July 1996 as an autonomous research institute within the Nanyang Technological University. Its obj...

Previous studies seem to agree that increased competition would cause riskier banking behavior. This dissertation shows that when competition intensiÞes, banks have greater incentives for screening loan applicants, and thus loan quality may improve. In addition, competition fosters banks to rely less on collateral requirements. Hence, banks may be less vulnerable to asset price shocks. The empi...

During the last three decades, the stock of government debt has increased in most developed countries. During the same period, we also observe a significant liberalization of international financial markets and an increase in income inequality in several industrialized countries. In this paper we propose a multicountry political economy model with incomplete markets and endogenous government bo...

IMF policies have been widely criticized in the aftermath of the Asian crisis. Key critics questioned the appropriateness and the sequencing of financial liberalization programs which, along with insufficient monitoring and inadequate prudential regulations, left the financial sectors of the affected countries highly leveraged and exposed. This paper examines the impacts of similar reforms on t...

Recent years have witnessed important structural changes around the world as a result of the globalization process, the creation of new economic blocks and the liberalization of financial sector in many countries. Responding to these changes many sectors of the industrialized countries have gone through major deregulatory changes to acclimate themselves to new environments. At the same time, ma...

Introduction In the 1940s, 1950s and 1960s development theory emphasized market failures, discontinuities, irreversibilities and excessive social inequality. The dominant development paradigm stressed the need for the state to create the adequate physical infrastructure, institutional and social conditions for development. This would entail implementing large scale public investment programs, p...