Abstract

http://ssrn.com/abstract=6638
 
 

Citations



 


 



A Conceptual Framework for Analyzing the Financial Environment


Zvi Bodie


Boston University - Department of Finance & Economics

Robert C. Merton


MIT Sloan School of Management; National Bureau of Economic Research (NBER); Harvard Business School - Finance Unit


WP#95-062

Abstract:     
This paper develops a conceptual framework for analyzing the global financial system. The framework has two major objectives: to address differences in institutional structure across borders and to explain changes in these institutional structures over time. Applicability of the framework ranges widely, from analysis of the entire financial system to individual business strategy decisions and specific public policy choices. It rests on two basic premises:

-Financial functions are more stable than financial institutions-that is, functions vary less across borders and change less over time.

-Competition will cause evolution in institutional structures to produce greater efficiency in the performance of financial system functions. That is, institutional form follows its function.

The evolution of the financial system is portrayed as an innovation spiral in which organized markets and intermediaries compete with each other in a static sense and complement each other in a dynamic sense.

JEL Classification: G1, G2

working papers series





Not Available For Download

Date posted: August 25, 1998  

Suggested Citation

Bodie, Zvi and Merton, Robert C., A Conceptual Framework for Analyzing the Financial Environment. WP#95-062. Available at SSRN: http://ssrn.com/abstract=6638

Contact Information

Zvi Bodie (Contact Author)
Boston University - Department of Finance & Economics ( email )
595 Commonwealth Avenue
Boston, MA 02215
United States
617-353-4160 (Phone)
617-353 6667 (Fax)
HOME PAGE: http://smgnet.bu.edu/mgmt/profiles/BodieZvi.html
Robert C. Merton
MIT Sloan School of Management ( email )
77 Massachusetts Avenue
E62-634
Cambridge, MA 02139-4307
United States
617 715 4866 (Phone)
National Bureau of Economic Research (NBER)
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
Harvard Business School - Finance Unit ( email )
Boston, MA 02163
United States
617-495-6678 (Phone)
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