Financial development in less-developed post-Communist economies

There is wide, albeit equivocal, acceptance that financial development and economic growth are related positively. Financial systems contribute to economic growth by fulfilling a number of important functions. In this article, we analyze the performance of financial systems in the less-developed post-Communist economies of the former Soviet Union in fulfilling those vital functions and compare this performance with more advanced transition economies. In general, we find significant progress being made toward building contemporary financial systems in all groups of transition economies, although the gap between financial systems in the less-developed post-communist countries and their more advanced counterparts remains very large

Financial System Reform in Kazakhstan from 1993 to 2006 and Its Socioeconomic Effects

Voluminous theoretical and empirical literature examines the relation between financial-sector development and economic growth. However, previous studies have largely ignored progress in former Soviet Central Asian republics engaged in transition from socialist command economies to market economies. This paper seeks to fill this gap in the literature by considering Kazakhstan's experience with financial-sector liberalization and the socioeconomic effects of these reforms. We summarize the prereform economic circumstances prevailing in Kazakhstan, outline the major characteristics of its postcommunist financial system, and provide a detailed chronicle of financial-sector reform measures from 1993 to 2006. The paper focuses on the evolution of Kazakhstan's banking structure, policies adopted by the National Bank of Kazakhstan, and the approach taken to the privatization of state banks, as well as the steps taken to improve bank accounting standards and banking supervision. The development path of nonbank financial institutions and capital markets is also examined. We consider the outcomes of financial-sector reforms and their effects on the economy as a whole.Griffith Business School, Department of Accounting, Finance and EconomicsNo Full Tex

The Coevolution of Finance and Property Rights: Evidence from Transition Economies

The transition from communism to capitalism was necessarily accompanied by a sudden and abrupt increase in the financialization of society. This increase occurred in an environment that, even now, still has little experience with or expertise in financialization. Given that financialization occurred simultaneously with the growth and evolution of other political and economic institutions, the question arises: What was the effect on these other nascent institutions like property rights? This article empirically analyzes the relationship between financialization and property rights in transition countries. Using a unique monthly database of twenty transition countries over a period from 1989 to 2012, this article finds that the influence of financialization depends on which definition of “financialization” is used. In particular, increases in basic financial intermediation improved property rights. However, higher-order “financialization,” proxied here by the size of capital markets and the wages in the financial sector, appeared to have a negative impact on the development of broad-based property rights in transition

Urban public transport in Post-Communist transition : the case of Tashkent, Uzbekistan

The post-communist transition of urban public transport in Eastern Europe and Central Asia is examined in this paper through the unique case of transport development in Tashkent, Uzbekistan. The paper discusses legislative changes and changes in governance and the evolution of the major modes of transport in terms of ownership, scale and reliability. Political economy constraints and socio-economic considerations have played an important role in how the reforms were approached and enforced both in early stages and later as a response to negative spillover effects from earlier reforms. Policy recommendations are made concerning the problems of transition to a post-independence urban transport system in Tashkent

Financial sector reforms in Indonesia and South Korea in 1980s and early 1990s

This article examines financial liberalisation in Indonesia and South Korea during the 1980s and the early 1990s. It provides a brief discussion of the pre-reform political and economic environment in the two countries, followed by a description of the state of the pre-reform financial sectors in both the countries. The article then focuses on the respective financial development policies and their pace, sequencing and outcomes in the two nations. The socio-economic impact of financial sector reforms is also carefully considered. The article concludes by summarising its main findings and drawing out some major policy implications.Griffith Business School, Department of Accounting, Finance and EconomicsNo Full Tex