Economic concentration and finance: Evidence from Russian regions
Hattendorff, Christian (18.05.2015)
Numero
18/2015Julkaisija
Bank of Finland
2015
Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:bof-201505201212Tiivistelmä
The paper investigates the relationship between economic concentration and level of financial development to illuminate the linkage of real economy structure and financial markets. Using data from 81 Russian regions for the period 2005–2011, empirical evidence is offered to show that poor diversification weakens credit. Geographical variables are used as instruments of concentration in accounting for endogeneity. This work supports previous findings at the national level that policymakers seeking to promote economic development should place stronger emphasis on output diversification.