Surveys of Theory, Evidence and Policy
Edited by Christopher J. Green, Colin Kirkpatrick and Victor Murinde
The role of ﬁnance in development has become a major topic for research and debate in the last two decades. Although it is widely agreed that there are important relationships between ﬁnance and the development process, there is much less agreement on the exact nature of these relationships, particularly on the causality between ﬁnance and development: is ﬁnancial development an essential prerequisite for general economic development, or is it more nearly a passive (if important) by-product of the development process? Development ﬁnance has become an important subject for teachers, researchers and policy makers. Despite this, there are relatively few convenient, up-todate sources of collected information on ﬁnance and development. There are few textbooks on the subject, and no major journals devoted to ﬁnance and development, although there are numerous specialist ﬁnance or development journals. It could be argued that this has encouraged a certain amount of polarization in the ﬁeld, with possible adverse implications for policy advice: development economists are rarely trained in ﬁnance, and ﬁnancial economists are rarely trained in development. While one would expect that developing countries could learn from the ﬁnancial experience of the industrial countries, and vice versa, it would be naïve to expect the solutions to policy problems in one country to be applicable a fortiori to apparently similar problems in other countries at different stages of development and with different institutional frameworks. We believe therefore that this is an opportune time to take stock of the existing state of knowledge in the ﬁeld...