Related items
Showing items related by title, author, creator and subject.
-
Bank Competition and Financial Stability : Friends or Foes?Theory makes ambiguous predictions about
 the relationship between market structure and
 competitiveness of the banking system and banking sector
 stability. Empirical studies focusing on individual
 countries provide similarly ambiguous results, while
 cross-country studies point mostly to a positive
 relationship between competition and stability in the
 banking system. Where liberalization and unfettered
 competition have resulted in fragility, this has been mostly
 the consequence of regulatory and supervisory failures. The
 advantages of competition for an efficient and inclusive
 financial system are strong, and regulatory and supervisory
 policies should focus on an incentive-compatible environment
 for banking rather than try to fine-tune market structure or
 the degree of competition.
-
Investment Climate Reforms and Job Creation in Developing Countries : What Do We Know and What Should We Do?This paper reviews the literature on the role of the investment climate reforms in job creation. It finds that the current landscape of employment and private sector activity in developing countries indicates a number of potential channels through which investment climate reforms can positively affect job creation. However, rigorous empirical evidence is scarce and most of the relevant studies focus on business entry reforms with a few focusing on business taxation and investment promotion activities. Overall, there is evidence of job creation through business entry, tax reforms, and investment promotion activity in developing countries. Almost all of these evidences are from quasi-experimental studies that are significant improvements over conventional cross-country or cross-section panel data analysis. Still, various endogeneity concerns in these studies cannot be ruled out completely. In assessing job effects, future research should provide deeper insights on the gross versus net and short-run versus long-run job effects and general equilibrium effects of various investment climate reforms related to jobs, productivity, competition, and other developmental outcomes. Another critical agenda for future research is to shed light on which investment climate reforms matter most for spurring the employment and productivity growth of firms in developing countries. The World Bank Group, in partnership with development partners and client government countries, can play a significant role in bridging the current knowledge gap by integrating rigorous evaluation as an integral part of project design and implementation, and improving data quality, particularly through its information and communication technologies-led private sector development reform initiatives.
-
Financial Sector Assessment Program Update : Republic of Kazakhstan - Bank Profitability and CompetitionThe purpose of this note is to explore
 the reasons for a comparatively high interest rate spread in
 Kazakhstan in the context of competition in the banking
 sector. In spite of significant gains in efficiency made in
 recent years, operational costs and provisioning for loan
 losses remain high compared to some other economies.
 Profitability of the aggregate banking system has increased
 in the face of lower interest spreads. A highly concentrated
 banking system could be an indicator of lack of competition,
 but it needs to be assessed with contestability conditions
 (openness to entry of banks). The lack of license
 applications since 2001 raises questions about the
 attractiveness of entry by new banks. Competitive and market
 contestability conditions will be further enhanced with the
 authorities' continuation of strong macroeconomic and
 financial policies, improvements in financial sector
 regulation and enforcement thus continuing the achievements
 during the last five years. Administrative measures to
 control interest rates (for instance, the ceiling on deposit
 rates introduced by the Deposit Insurance Fund and tax
 incentives) only distort financial intermediation, and are
 likely to be counterproductive.