In this comparative study of programmes against poverty in developing countries, the authors argue that building sustainable, target group-oriented financial institutions is important and feasible, and that it is likely to have greater development impact than the channelling of external funds to poor target groups (small and micro-scale business, small farmers, and women). The analysis has far-reaching implications for development policy and will interest development specialists, policymakers, and scholars of development finance and international banking.

The authors of this timely analysis compare the different ways in which financial services in developing countries are provided to poor target groups largely cut off from formal financial systems: small and micro-scale business, small farmers, and women. They argue that building sustainable and target group-oriented financial institutions is important and feasible, and that such building is likely to have greater development impact than the channeling of external funds to poor target groups. Yet the provision of financial services to the poor as well as institution-building efforts are likely to run into severe information and incentive problems. How these problems can be addressed and overcome is central to the authors' analysis. Drawing extensively on the conceptual tools of the new economics of information and institutions, Krahnen and Schmidt examine real-world cases of institution building. They consider formal and informal financial institutions, in particular group lend ing, rotating savings and credit associations (RoSCAs), and financial cooperatives, and demonstrate how information and institution economics can be put into prac tice. Development Finance as Institution Building has far-reaching implications for development policy and the design of aid programs. It is crucial reading for development specialists, policymakers, and scholars of development finance and international banking. This study has been prepared on behalf and with the support of the International Labour Office (ILO). It forms part of a program that explores the links between finance and poverty reduction.

Financial crises have been pervasive for many years. Their frequency in recent decades has been double that of the Bretton Woods Period (1945-1971) and the Gold Standard Era (1880-1993), comparable only to the period during the Great Depression. Nevertheless, the financial crisis that started in the summer of 2007 came as a great surprise to most people. What initially was seen as difficulties in the U.S. subprime mortgage market, rapidly escalated and spilled over first to financial markets and then to the real economy. The crisis changed the financial landscape worldwide and its full costs are yet to be evaluated. One important reason for the global impact of the 2007-2009 financial crisis was massive illiquidity in combination with an extreme exposure of many financial institutions to liquidity needs and market conditions. As a consequence, many financial instruments could not be traded anymore, investors ran on a variety of financial institutions particularly in wholesale markets, financial institutions and industrial firms started to sell assets at fire sale prices to raise cash, and central banks all over the world injected huge amounts of liquidity into financial systems. But what is liquidity and why is it so important for firms and financial institutions to command enough liquidity? This book brings together classic articles and recent contributions to this important field of research. It is divided into five parts. These are (i) liquidity and interbank markets; (ii) the public provision of liquidity and regulation; (iii) money, liquidity and asset prices; (iv) contagion effects; (v) financial crises and currency crises. The aim is to provide a comprehensive coverage of role of liquidity in financial crises.

Financial crises have been pervasive for many years. Their frequency in recent decades has been double that of the Bretton Woods Period (1945-1971) and the Gold Standard Era (1880-1993), comparable only to the period during the Great Depression. Nevertheless, the financial crisis that started in the summer of 2007 came as a great surprise to most people. What initially was seen as difficulties in the U.S. subprime mortgage market, rapidly escalated and spilled over first to financial markets and then to the real economy. The crisis changed the financial landscape worldwide and its full costs are yet to be evaluated. One important reason for the global impact of the 2007-2009 financial crisis was massive illiquidity in combination with an extreme exposure of many financial institutions to liquidity needs and market conditions. As a consequence, many financial instruments could not be traded anymore, investors ran on a variety of financial institutions particularly in wholesale markets, financial institutions and industrial firms started to sell assets at fire sale prices to raise cash, and central banks all over the world injected huge amounts of liquidity into financial systems. But what is liquidity and why is it so important for firms and financial institutions to command enough liquidity? This book brings together classic articles and recent contributions to this important field of research. It is divided into five parts. These are (i) liquidity and interbank markets; (ii) the public provision of liquidity and regulation; (iii) money, liquidity and asset prices; (iv) contagion effects; (v) financial crises and currency crises. The aim is to provide a comprehensive coverage of role of liquidity in financial crises.

Dieses Buch setzt sich mit der verbreiteten Auffassung auseinander, daB Sunk Costs fUr betriebswirtschaftliche Entscheidungssituationen irrelevant seien. Nach dieser Ansicht stellen Sunk Costs in der Vergangenheit begriindete und in der gegenwartigen Entscheidungssituation unvermeidbare "Altlasten" dar. Fiir zukunftsgerichtete Entscheidungen diirfen diese irreversiblen Altlasten keine Bedeutung haben und sie sollen daher -- so wird gefordert -- vernachlassigt werden. 1m Unterschied hierzu wird im folgenden die fUr investitionsrechnerische Fragestellungen zweckmaBige Planungsperspektive eingenommen. Die betrachtete betriebswirtschaftliche Problemsituation liegt daher zeitlich noch vor der Entscheidung, die das spatere Auftreten von irreversiblen Altlasten begriindet. Sunk Costs treten aus der planerischen Perspektive zukiinftig auf und die mit ihnen verbundenen besonderen Probleme der Irreversibilitat entfalten sich erst wahrend der spateren Durchfiihrung des Investitionsprojektes. Diese besonderen Probleme konnen aber bereits in der Planungsphase antizipiert werden. Anhand ausgewahlter Beispiele wird gezeigt, wie diese Antizipation von Sunk Costs die Leistungsfiihigkeit betriebswirtschaftlicher Investitionsrechnungen zu erhOhen vermag und dabei den Zugang zu neuen finanzwirtschaftlichen Fragestellungen eroffnet. Hierzu ziihlt insbesondere eine okonomische Erklarung der Funktionsweise finanzwirtschaftlicher Institutionen. Es wird dariiber hinaus der Begriff der Sunk Costs prazisiert, in dem Vorschlage zu einer sinnvollen Messung ihrer Hohe entwickelt werden. Nach einigen sprachlichen Verrenkungen habe ich mich entschieden, den Begriff der "Sunk Costs" durchgangig mit "versunkene Kosten" zu iibersetzen. Methodisch stellt die Studie eine Anwendung der neueren Institutionenokonomik auf I traditionelle I finanzwirtschaftliche Fragestellungen dar. Der besondere Reiz und die besondere Relevanz dieses Ansatzes liegt in einer Verkniipfung der Entscheidungstheorie unter Unsicherheit mit den Problemen, die sich aufgrund von Interessenskonflikten zwischen einzelnen Vertragsparteien ergeben.

Karl-Hermann Fischer untersucht in einer empirischen Analyse die Bedeutung der Wettbewerbsintensitat im Bankenmarkt insbesondere fur kleine und mittelstandische Unternehmen in Deutschland. Im Mittelpunkt steht hierbei der Einfluss des Wettbewerbs auf Kreditzinsen sowie die Bedeutung des Bankenwettbewerbs fur die Mittelstandsfinanzierung.