Financial reforms – and doubts about them – are documented at least as far back as the Scottish free banking era of the eighteenth and nineteenth century, and it is likely that, in the wake of the banking crisis of 33 a.d., Romans debated putting a hitherto liberal banking system under government control. Financial reform in the modern era is unusual at least in its frequency: Most industrialized countries have embarked on measures to liberalize finance in some manner in the last two decades, and a growing number of developing countries are moving along that course more recently. Even if university courses in development traditionally have attributed little role to finance in the development process, practitioners in the field as well as increasing numbers of academics seem to be convinced both that finance matters and that “market-oriented” financial systems can exert a positive influence on the economy, albeit with significant differences as to the proper or optimal role for market forces.

This study has considered the impact of financial reforms on both the real and financial sectors of selected countries. The cases examined here differ markedly in their economic, political, and institutional development, which, along with their meager number, raises problems in drawing lessons. Moreover, it is difficult to describe any of these efforts as complete. Reforming the financial system should be thought of as a process, not an event, both because most governments enact reforms in stages, and, in particular, because institutions take substantial time to adjust.