Prague Economic Papers 2005, 14(1):17-32 | DOI: 10.18267/j.pep.250
Financial Integration and the New EU Member Countries: Challenges and Dilemmas
- Dept. of Economics, Susquehanna University, Selinsgrove, PA 17870 (e-mail: Rusek@susqu.edu).
Real convergence is the key economic challenge for the new EU Member Countries. The main growth area today is the "new" entrepreneurial economy of creativity and innovation. But such an economy needs a financial structure capable of coping with the higher risk inherent in the "new" economy. To provide such a financial structure, the financial markets must be broad, deep and liquid, i.e. financial markets must be large enough to provide this financial structure. Hence, the financial integration became an imperative for the new Member Countries. But this integration process possesses both economic and political challenges and dilemmas. Answers to those challenges and dilemmas will then determine the degree of real convergence - and hence the degree of economic success - for each new Member State.
Keywords: financial sector, real convergence, financial integration, new EU Member Countries, 'new' economy
JEL classification: F36, F39, F43, O16
Published: January 1, 2005 Show citation
References
- Annual Report 1999 (2000), Federal Reserve Bank of Dallas.
- Begg, D., Eichengreen, B., Halpern, L., Hagen, J. von, Wyplosz, Ch. (2003), "Accession Countries Face Increased Instability in ERM-II". London, CEPR Policy Paper No. 10.
- Bencivenga, B., Smith, V. (1991), "Financial Intermediation and Endogenous Growth". Review of Economic Studies, 58, pp. 195-209.
Go to original source...
- Berger, A., Udell, G. (2002), "Small Business Credit Availability and Small Business Lending: The Importance of Bank Organizational Structure". Economic Journal, 112 (477), pp. F32-F53.
Go to original source...
- Botazzi, L., Da Rin, M. (2002), "Venture Capital in Europe and the Financing of Innovative Companies". Economic Policy, 17, pp. 231-250.
Go to original source...
- Caviglia, G., Krause, G., Thimann, Ch. (2002), "Key Features of the Financial Sectors in EU Accession Countries", in Thimann, Ch., ed., Financial Sectors in EU Accession Countries. Frankfurt/M, European Central Bank, pp. 15-30.
- Claessens, S., Klingebiel, D., Schmukler, S. L. (2002), "The Future of Stock Exchanges in Emerging Economies: Evolution and Prospects". Brookings-Wharton Paper on Financial Services, pp. 167202.
Go to original source...
- De Gregorio, J. (1998), "Financial Integration, Financial Development and Economic Growth". Universidad de Chile, mimeo.
- Duisenberg, W. F. (2001), "The ECB and the Accession Process". Speech at the Frankfurt European Banking Congress.
- Edison, H. J., Levine, R., Ricci, L., Slok, T. (2002), "International Financial Integration and Economic Growth." Washington, IMF Working Paper 02/145 (a).
Go to original source...
- Edison, H. J., Klein, M., Ricci, L., Slok, T. (2002), "Capital Account Liberalization and Economic Performance: Survey and Synthesis." Washington, IMF Working Paper 02/120 (b).
Go to original source...
- Favara, G. (2003), "An Empirical Reassessment of the Relationship between Finance and Growth". Washington, IMF Working Paper 03/123.
Go to original source...
- Giannetti, M., Guiso, L., Jappelli, T., Padula, M., Pagano, M. (2002), "Financial Market Integration, Corporate Financing and Economic Growth: Final Report". European Commission, Directorate General for Economic and Financial Affairs, Economic Papers No. 179.
- Gilson, R. J. (2003), "Engineering a Venture Capital Market: Lessons from the American Experience". Stanford Law Review, 55 (4), pp. 1067-1105.
- Gjersem, C. (2003), "Financial Market Integration in the Euro Area". Paris, OECD, Economics Department, Working Paper No. 368.
Go to original source...
- Goldsmith, R. (1969), Financial Structure and Development. New Hawen: Yale University Press.
- Greenwood, J., Jovanovic, B. (1990), "Financial Development, Growth, and the Distribution of Income". Journal of Political Economy, 98, pp. 1076-1107.
Go to original source...
- Hartmann, Ph., Maddaloni, A., Manganelli, S. (2003), "The Euro Area Financial System: Structure, Integration and Policy Initiatives". Frankfurt/M, European Central Bank, ECB Working Paper No. 230.
Go to original source...
- Hughes, P. (2002), "EU Accession Countries and the Financial Sector". Banking Ireland, Autumn, pp. 12-16.
- King, R. G., Levine, R. (1993), "Finance and Growth: Schumpeter Might be Right". Quarterly Journal of Economics, 108 (3), pp. 639-671.
Go to original source...
- Levine, R. (2001), "International Financial Liberalization and Economic Growth". Review of International Economics, 9 (4), pp. 688-702.
Go to original source...
- Levine, R. (1997), "Financial Development and Economic Growth: Views and Agenda". Journal of Economic Literature, 35 (2), pp. 688-726.
- Levine, R., Loayza, N., Beck, Th. (2000), "Financial Intermediation and Growth: Causality and Causes". Journal of Monetary Economics, 46, pp. 31-77.
Go to original source...
- Meade, E. E., Mueller-Plantenberg, N., Pisani, M. (2002), "Exchange Rate Arrangements in EU Accession Countries: What are the Options?" London, Centre for Economic Performance, LSE, Occasional Paper No. CEPOP17.
- Noyer, Ch. (2001), "Challenges Ahead: The Accession Process." The speech given at UK Foreign and Commonwealth Office.
- Obstfeld, M. (1994), "Risk Taking, Global Diversification and Growth". American Economic Review, 84, pp. 1310-1329.
- Padoa-Schioppa, T. (2002), "The Importance of Financial Sector Development in EU Accession Countries", in Thimann, Ch., ed., "Financial Sectors in EU Accession Countries". Frankfurt/M, European Central Bank, pp. 5-6.
- Prasad, E., Rogoff, K., Wei, Shang-Jin, Kose, A. M. (2003), "Effects of Financial Globalization on Developing Countries: Some Empirical Evidence". Washington, IMF Occasional Paper No. 220.
- Rajan, R. G., Zingales, L. (2001), "Financial Systems, Industrial Structure and Growth". Oxford Review of Economic Policy, 17 (4), pp. 467-482.
Go to original source...
- Rajan, R. G., Zingales, L. (2003), "The Changing Character of European Finance". Paper prepared for the 2nd ECB Central Banking Conference.
- Schweickert, R. (2002), "The Integration of Accession Countries into EMU - Concerns about Convergence". Paper presented at the ACE-Phare seminar Money and Exchange Rate Strategies related to the Current EU Enlargement. Warsaw.
Go to original source...
- Solans, E. D. (2002), "The Relevance of Financial Sector Developments for Accession Countries". Speech at the 3rd Cyprus Summit on Countdown to European Accession.
- Thimann, Ch. ed. (2002), "Financial Sectors in EU Accession Countries". Frankfurt/M, European Central Bank.
- Wagner, H. (2003), "Pitfalls in EMU-enlargement". Washington, D. C., American Institute for Contemporary German Studies Advisor.
- Wagner, N., Iakova, D. (2001), "Financial Sector Evolution in the Central European Economies: Challenges in Supporting Macroeconomic Stability and Sustainable Growth". Washington, IMF Working Paper 01/141.
Go to original source...
This is an open access article distributed under the terms of the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License (CC BY NC ND 4.0), which permits non-comercial use, distribution, and reproduction in any medium, provided the original publication is properly cited. No use, distribution or reproduction is permitted which does not comply with these terms.