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Papers by Nikolay K Gueorguiev
The financial systems of developing countries tend to be "restricted" or "represse... more The financial systems of developing countries tend to be "restricted" or "repressed" by burdensome reserve requirements, interest-rate ceilings, foreign-exchange regulations, constraints on banks? balance sheets, and the heavy financial-sector taxation. This article explores preliminary evidence from the post-communist economies of Eastern Europe and the former Soviet Union. Using data from 25 countries between 1991 and 1996, we find that the standard public-finance framework has limited applicability to the transition economies. It is more fruitful to examine how political institutions affect financial policy. Our findings suggest that post-communist governments may adopt repressive financial controls to ensure the survival of those in power. In countries where the pre-reform elite are abundant in legislative bodies and where interparty competition is low, such elite have perpetuated a system of implicit subsidies. The main beneficiaries of these policies are la...
IMF Working Papers, 2017
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC.
Comparative Economic Studies, 2006
In recent years, a 'consensus' explanation of policy reform in the transition economies has emerg... more In recent years, a 'consensus' explanation of policy reform in the transition economies has emerged, according to which, greater political partisanship and intra-government division promotes progress in reform. Using panel data from 24 post-Communist countries between 1991 and 1998, we find that increasing the number of veto players faced by the executive branch promotes financial reform. However, countries where ruling parties controlled both executive and legislative branches of governments-as long as those governments were constitutionally constrained-were more likely to dismantle preferential credit programmes and implement banking and securities' market reforms. Meanwhile, communist party strength and limited partisanship increase the likelihood that governments will remove financial restrictions but do not have clear effects on the adoption of subsequent financial-regulatory reforms. These findings suggest several modifications to the consensus explanation of economic reform in the transition.
Policy Research Working Papers, 1999
IMF Working Papers
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC.
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC. JEL Classification Numbers: C23, C26, E51, G01, G21, O47, O52;
The views expressed in this Working Paper are those of the author(s) and do not necessarily repre... more The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
The financial systems of developing countries tend to be "restricted" or "represse... more The financial systems of developing countries tend to be "restricted" or "repressed" by burdensome reserve requirements, interest-rate ceilings, foreign-exchange regulations, constraints on banks? balance sheets, and the heavy financial-sector taxation. This article explores preliminary evidence from the post-communist economies of Eastern Europe and the former Soviet Union. Using data from 25 countries between 1991 and 1996, we find that the standard public-finance framework has limited applicability to the transition economies. It is more fruitful to examine how political institutions affect financial policy. Our findings suggest that post-communist governments may adopt repressive financial controls to ensure the survival of those in power. In countries where the pre-reform elite are abundant in legislative bodies and where interparty competition is low, such elite have perpetuated a system of implicit subsidies. The main beneficiaries of these policies are la...
IMF Working Papers, 2004
The views expressed in this Working Paper are those of the author(s) and do not necessarily repre... more The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
IMF Working Papers, 2005
This Working Paper should not be reported as representing the views of the IMF.
Comparative Economic Studies, 2006
Policy Research Working Papers, 1999
The financial systems of developing countries tend to be "restricted" or "represse... more The financial systems of developing countries tend to be "restricted" or "repressed" by burdensome reserve requirements, interest-rate ceilings, foreign-exchange regulations, constraints on banks? balance sheets, and the heavy financial-sector taxation. This article explores preliminary evidence from the post-communist economies of Eastern Europe and the former Soviet Union. Using data from 25 countries between 1991 and 1996, we find that the standard public-finance framework has limited applicability to the transition economies. It is more fruitful to examine how political institutions affect financial policy. Our findings suggest that post-communist governments may adopt repressive financial controls to ensure the survival of those in power. In countries where the pre-reform elite are abundant in legislative bodies and where interparty competition is low, such elite have perpetuated a system of implicit subsidies. The main beneficiaries of these policies are la...
IMF Working Papers, 2017
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC.
Comparative Economic Studies, 2006
In recent years, a 'consensus' explanation of policy reform in the transition economies has emerg... more In recent years, a 'consensus' explanation of policy reform in the transition economies has emerged, according to which, greater political partisanship and intra-government division promotes progress in reform. Using panel data from 24 post-Communist countries between 1991 and 1998, we find that increasing the number of veto players faced by the executive branch promotes financial reform. However, countries where ruling parties controlled both executive and legislative branches of governments-as long as those governments were constitutionally constrained-were more likely to dismantle preferential credit programmes and implement banking and securities' market reforms. Meanwhile, communist party strength and limited partisanship increase the likelihood that governments will remove financial restrictions but do not have clear effects on the adoption of subsequent financial-regulatory reforms. These findings suggest several modifications to the consensus explanation of economic reform in the transition.
Policy Research Working Papers, 1999
IMF Working Papers
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC.
This paper reviews the empirical relationships between credit growth, economic recovery, and bank... more This paper reviews the empirical relationships between credit growth, economic recovery, and bank profitability in Europe after the global financial crisis (GFC). We find that the post-GFC recoveries in Europe have been weaker than previous recoveries, with the "double-dip" recessions in 2011-12 in many countries and the worldwide reach of the GFC explaining the underperformance. Bank lending has been subdued as well, but this appears to have only held back the recovery relatively moderately. A 10 percent increase in bank credit to the private sector is associated with a rise of 0.6-1 percent in real GDP and 2-2½ percent in real private investment. These relationships have not changed significantly during and after the GFC. Loan quality, customer deposits, bank equity price index, and bank capital appear to be closely linked to bank lending. As expected, bank profitability is positively and significantly influenced by credit growth, but this relationship has weakened after the GFC. JEL Classification Numbers: C23, C26, E51, G01, G21, O47, O52;
The views expressed in this Working Paper are those of the author(s) and do not necessarily repre... more The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
The financial systems of developing countries tend to be "restricted" or "represse... more The financial systems of developing countries tend to be "restricted" or "repressed" by burdensome reserve requirements, interest-rate ceilings, foreign-exchange regulations, constraints on banks? balance sheets, and the heavy financial-sector taxation. This article explores preliminary evidence from the post-communist economies of Eastern Europe and the former Soviet Union. Using data from 25 countries between 1991 and 1996, we find that the standard public-finance framework has limited applicability to the transition economies. It is more fruitful to examine how political institutions affect financial policy. Our findings suggest that post-communist governments may adopt repressive financial controls to ensure the survival of those in power. In countries where the pre-reform elite are abundant in legislative bodies and where interparty competition is low, such elite have perpetuated a system of implicit subsidies. The main beneficiaries of these policies are la...
IMF Working Papers, 2004
The views expressed in this Working Paper are those of the author(s) and do not necessarily repre... more The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate.
IMF Working Papers, 2005
This Working Paper should not be reported as representing the views of the IMF.
Comparative Economic Studies, 2006
Policy Research Working Papers, 1999