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Financial transition in pre-World War II Japan and Southeast Asia

Published online by Cambridge University Press:  05 November 2007

Gregg Huff
Gregg Huff
Affiliation:
Department of Economics, University of Glasgow, Glasgow G12 8RT, Scotland, w.g.huff@lbss.gla.ac.uk
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Extract

Self-sustaining, technologically based growth has always been accompanied by a process of financial transition which, as defined by Raymond Goldsmith, entails an increase in the financial superstructure to a status in the economy comparable to that in the leading countries of North America and Western Europe. The pattern of development along this transitional path may, of course, differ, as for example in the relative contribution of bank- or market-based financial systems. But all countries, Goldsmith observed, trace a similar transitional path in the increase in their superstructure of financial instruments and institutions relative to an infrastructure of output and wealth. Because of the close relationship between financial transition and modern economic growth as defined by Simon Kuznets, differences in speed at which countries traverse Goldsmith's transitional path are critical.

Type
Research Article
Information
Financial History Review , Volume 14 , Issue 2 , October 2007 , pp. 149 - 175
Copyright
Copyright © European Association for Banking and Financial History 2007

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References

1 An earlier version of this article was presented at the 2003 Economic History Association Meeting in Nashville. Thanks go to conference participants for many helpful comments and suggestions and to Andrew Bain, Michael Edelstein, Tim Guinnane, Janet Hunter, Joel Mokyr, Larry Neal and Dick Sylla. Thanks also to the editor and two anonymous referees for a number of useful ideas and clarifications which considerably improved the article. Support for research and data collection provided by the Nuffield Foundation, the Carnegie Trust, Scotland, and the British Academy is gratefully acknowledged.

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