The Emergence of Bank-Issued Credit in Russia: An Empirical Characterization

32 Pages Posted: 3 Jul 2010 Last revised: 5 Jul 2010

Daniel Berkowitz

University of Pittsburgh - Department of Economics

David N. DeJong

University of Pittsburgh - Department of Economics

Date Written: March 1, 2010

Abstract

Bank-issued credit is an important source of external financing for dynamic firms in transition economies. However, banks with a primary mission of issuing loans to private firms have only recently emerged in Russia. While this emergence (and subsequent expansion) appears to be carrying significant implications for Russia’s continuing economic development, it is a far from universal phenomenon when viewed from a regional perspective. The purpose of this paper is to document regional patterns of the emergence and expanding importance of bank-issued credit within Russia; to note its relationship with regional patterns of economic activity; and to seek an empirical account of the regional variations we observe. In pursuing the latter objective, we document that regional variations in the influence of the communist party evident in the former Soviet Union retain remarkable explanatory power in accounting for regional variations in bank-financing activity. An account of the persistence of this influence will be the subject of future research.

Keywords: economic growth, institutional persistence

JEL Classification: O4, P3, R1

Suggested Citation

Berkowitz, Daniel and DeJong, David N., The Emergence of Bank-Issued Credit in Russia: An Empirical Characterization (March 1, 2010). 5th Annual Conference on Empirical Legal Studies Paper. Available at SSRN: https://ssrn.com/abstract=1633525 or http://dx.doi.org/10.2139/ssrn.1633525

Daniel Berkowitz (Contact Author)

University of Pittsburgh - Department of Economics ( email )

4711 WWPH
Pittsburgh, PA 15260
United States
412-648-7072 (Phone)
412-648-3011 (Fax)

HOME PAGE: http://www.pitt.edu/~dmberk

David N. Dejong

University of Pittsburgh - Department of Economics ( email )

4A21 Forbes Quad
Pittsburgh, PA 15260
United States
(412) 648-2242 (Phone)

Paper statistics

Downloads
25
Abstract Views
359