Financial Indicators
 
Contact:  Robert Inklaar
 
Objectives of the Workpackage

The key aim of WP4 was to develop a range of indicators that measure the performance of the financial services sector; their linkages to the rest of the economy; competition in the financial sector; and the cross-border integration of financial services. These indicators will then be used to gain a better understanding of the role of the financial sector in the economy. We analyze questions such as whether a more developed financial system improves economic growth; which dimensions of the financial system are important; the channels through which growth is influenced; the role of competition in the banking sector on growth effects; whether competition in banking stimulates competition in the rest of the economy; and whether more thorough financial integration has growth benefits.

Construction of Indicators

Constructing the indicators for financial services utilised a range of publicly available data sources, including interest rate and balance sheet surveys and databases such as Bankscope and Amadeus. This lead to the following indicators: improved output measures for banking both in current and constant prices; measures of the dependence on external finance; cost and profit efficiency scores for banks; other measures of financial development; indicators of competition in banking such as Lerner or Boone indicators; and new indicators of financial integration/internationalization/openness

In many cases, substantial coverage of the EU was achieved, although this was dependent on the availability and quality of the source data. For instance, if there was data on too few banks, certain competition indicators could not be estimated.
 
 

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Contact details

Contact:

 

Judith Harris

 

Birmingham Business School
Edgbaston Park Road
Birmingham B15 2TT

 

Email:

 

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Legal notice

This project is funded by the European Commission, Research Directorate General as part of the 7th Framework Programme, Theme 8: Socio-Economic Sciences and Humanities.

Grant Agreement no:244 709

The views expressed in this website are the sole responsibility of the author and do not necessarily reflect the views of the European Commission.

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