Download publication

Working Paper

The changing landscape of financial markets in Europe, the United States and Japan

We compare the structure of the financial sectors of the EU27, Japan and the United States, looking at a set of 23 indicators.

By: and Date: March 18, 2013 Finance & Financial Regulation Tags & Topics

We compare the structure of the financial sectors of the EU27, Japan and the United States, looking at a set of 23 indicators.

We find a large variation within the European Union in the structure of the financial sector. Using principal components analysis, we identify robust groups of EU countries. One group consists of the eastern European members that entered the EU more recently.These have substantially smaller financial sectors than the old member states. A second group can be classified as market-based (MBEU) and the third group is more bank-based (BBEU).

We compare US, MBEU, BBEU, Eastern EU and Japan with the following main results. First, the groups within Europe are geographically related. Second, in many indicators, MBEU countries are closer to the (market-based) US, while BBEU countries more closely resemble Japan. Paradoxically, however, market-based EU countries also have large banking sectors. Banks in market-based countries have larger cross-border assets and liabilities, and derive a larger fraction of their income from fees, rather than interest income, than banks in bank-based countries. Finally, for most indicators, the ordering of groups of countries is quite stable over time, but while the crisis has had no impact on the relative ordering of the groups, it has slightly widened the gap between the US and all EU regions insome respects. We also find that during the crisis, substitution between market-based and bank-based sources of finance occurred in the US, and to a lesser extent in MBEU and BBEU countries.

View comments
Read article More on this topic More by this author

Blog Post

Alicia García-Herrero

Japan needs labour market reform, not just higher wages

The Japanese government is trying to boost wages, but this is not enough to jumpstart growth. Japan needs to reform its labour market to increase the number of women in the workforce and boost labour productivity.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: April 14, 2016
Read about event More on this topic

Past Event

Past Event

The new silk road: what is in it for Europe

How will the new Silk Road initiative affect the European economy?

Speakers: Jean-Francois Di Meglio, Pedro Nueno, Alicia García-Herrero, Elton Huang, David Gosset, Juan Carlos Martinez Oliva, Michael McCannon, Gary Liu, Edith Terry, Caspar Welbergen, Kar-yiu Wong, Jianwei Xu, Xu Sitao, Xue Li, Zhang Xiaoqiang and Zhao Jinping Topic: Global Economics & Governance Location: Shanghai Date: January 14, 2016
Read article More on this topic More by this author

Opinion

Alicia García-Herrero

Indebted ASEAN companies will feel Fed's rate rise

While the markets could not have been surprised about the U.S. Federal Reserve's decision to raise interest rates after a series of warnings since mid-2013, the key question is whether Asia is ready.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: December 22, 2015
Read article Download PDF More on this topic More by this author

Working Paper

Internationalising the currency while leveraging massively: the case of China

Internationalising the currency while leveraging massively: the case of China

This paper reviews the steps that China has taken towards financial reform with a particular focus on capital account liberalisation and internationalisation of the use of the renminbi.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: October 29, 2015
Read article Download PDF More on this topic

Working Paper

Enhancing financial stability in developing Asia

Enhancing financial stability in developing Asia

This paper outlines guidelines for policymakers pursuing financial stability in developing Asia. It aims at supporting Asian policymakers’ judgment by providing policy views and recommendations that are based on the analysis of the recent sequence of events in the United States and Europe and of earlier crisis episodes, including those in Asia during the 1990s

By: Adam Posen and Nicolas Véron Topic: Global Economics & Governance Date: October 20, 2015
Read about event More on this topic

Past Event

Past Event

Secular Stagnation in Europe and Japan

This is the 3rd conference in a series of events jointly organised by Graduate School of Economics, Kobe University and Bruegel

Speakers: Grégory Claeys, Marcia De Wachter, Philipp Hartmann, Juan F. Jimeno, Toshiki Jinushi, Yoichi Matsubayashi, Ryuzo Miyao, Rainer Münz, Xavier Ragot, Paul Swaim, Coen Teulings, Atsuko Ueda, Natacha Valla, Guntram B. Wolff, Masahiko Yoshii and Naoyuki Yoshino Topic: Global Economics & Governance Location: Bruegel, Rue de la Charité 33, 1210 Brussels Date: October 5, 2015
Read about event More on this topic

Past Event

Past Event

12th Asia Europe Economic Forum (AEEF)

This year's conference is entitled "Global Governance of Public Goods: Asian and European Perspectives".

Speakers: Chong-en Bai, Björn Conrad, Giancarlo Corsetti, Zsolt Darvas, Jean-Francois Di Meglio, Andreas Esche, Joseph Francois, He Fan, Kiyoto Ido, Sébastien Jean, Jun Zhang, Masahiro Kawai, Pascal Lamy, Il Houng Lee, Klaus Masuch, Yung Chul Park, Innwon Park, Mitsutsune Yamaguchi, Naoyuki Yoshino, Natacha Valla, Claude Blanchemaison, Jean Lemierre and Guntram B. Wolff Topic: Global Economics & Governance Location: France Stratégie, 18, rue Martignac, 75007 Paris, France Date: October 1, 2015
Read article More on this topic More by this author

Opinion

Alicia García-Herrero

China's woes could derail Abenomics

The Japanese economy is already showing clear signs of renewed weakness.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: September 18, 2015
Read article More on this topic

Blog Post

Ashoka Mody

Delhi’s children deserve quality education

Money has not held up educational advancement in Delhi or in India more generally. Delhi’s education budget has risen steadily. And the worry is that the increased budget will once again be hijacked by glamorous but wasteful projects, including in higher education.

By: Ashoka Mody and Ritika Katyal Topic: Global Economics & Governance Date: August 4, 2015
Read article More on this topic More by this author

Opinion

Alicia García-Herrero

Europe must wake up before Iran falls into the arms of Russia and China

European leaders seem to have been caught somewhat off-guard by the Iran deal. The Greek saga alone could explain this. The problem is that other competitors —Russia and China— are one step ahead.

By: Alicia García-Herrero Topic: Global Economics & Governance Date: August 3, 2015
Read article More by this author

Blog Post

Alicia García-Herrero

China's stock market falling off a cliff: Why, and why care?

Spurred by interventions from Chinese authorities, the Chinese stock market was rallying. However, the recent sell-off has wiped out one third of China’s stock market value. Why is this happening and what does it mean for the global economy?

By: Alicia García-Herrero Topic: Finance & Financial Regulation, Global Economics & Governance Date: July 9, 2015
Read article More on this topic More by this author

Blog Post

Alicia García-Herrero

China’s outward foreign direct investment

China’s outbound foreign direct investment (ODI) may have exceeded inbound foreign direct investment (FDI) for the first time in 2014, according to the Ministry of Commerce of the People’s Republic of China (MOFCOM).

By: Alicia García-Herrero Topic: Global Economics & Governance Date: June 28, 2015
Load more posts