Naslov
Development of Financial Institutions in Transition Economies ; the importance of financial regulation: A Croatian case-study

Autori
Božina, Marta ; Štajfer, Josip

Izvornik
The business review, Cambridge (1553-5827) 8 (2007), 1; 121-128

Vrsta, podvrsta i kategorija rada
Radovi u časopisima, članak, znanstveni

Ključne riječi
Financial system ; transition ; development

Sažetak
Numerous research and work papers discuss the positive correlation between a well developed financial system and a good overall economic performance in industrialized countries. In this paper we focus mainly on the particularities of transition countries and their financial sector – on a case study analysis of the current Croatian financial system development and trends in forming new financial institutions. In order to ascertain the role of financial intermediaries which are new to a transition economy, the paper analyses the structuring of investment funds and their economic management. We analyze the meaning of the structure of financial systems and the management of its markets, especially the capital market, in transition economies. We approach this issue with special regards to the Croatian capital market and investment funds as its component, analysing the existing unbalance in the financial system. The weakness of Croatian financial system is its structure symbolised by well-developed banks and by poorly developed market. As an EU candidate country, Croatia is undergoing substantive structural changes in the financial system. Strengthening of the non-bank financial institutions such as investment funds, would highly contribute to Croatia’s financial sector stability. These goals cannot be achieved without targeted state intervention through legal regulation in financial markets resulting in positive external effects – economic development and sustained prosperity. Capital account liberalization is seen as an essential, and even inevitable, step on the path to economic development, analogue to the earlier reductions in barriers to international trade in goods and services. Modern financial markets are the structural basis of a well-performing liberal economy and the key vector of trans-border integration. The leading trend of financial globalisation and the increase in international financial flows challenge economic systems worldwide – demanding for a developed financial structure and a sound legal environment in which positive impacts of financial intermediation on overall economic performance can be expected.

Izvorni jezik
Engleski

Znanstvena područja
Ekonomija

POVEZANOST RADA