توسعه مالی و تخصیص منابع مالی خارجی

We examine whether financial markets development facilitates the efficient allocation of resources. Using European micro-level data for 1996–2005, we show that firms in industries with growth opportunities use more external finance in financially more developed countries. This result is particularly strong for firms that are more likely to be financially constrained and dependent on domestic financial markets, such as small and young firms. Our findings are robust to controlling for technological determinants of external finance needs and to using different proxies for growth opportunities. Interestingly, the explanatory power of the measures of technological determinants identified in prior work decreases significantly once growth opportunities are controlled for.

The key role of a financial system is to acquire information about investment opportunities and facilitate the allocation of resources into viable projects.1 Recent empirical work uses aggregate data to present indirect evidence that more developed financial markets allocate capital more efficiently. Wurgler (2000) estimates the effect of financial development on the elasticity of aggregate investment with respect to growth opportunities. Fisman and Love (2004) measure the effect of financial development on the growth of industries with positive opportunities.2 If more developed financial markets allocate capital more efficiently, it must be that they are able to identify firms with growth opportunities and to channel external finance toward these firms when they need it.

The most important role of a financial system is to provide external finance to viable firms so that they can exploit growth opportunities. The primary focus of this paper is to study whether the financial markets development improves the efficiency of the capital allocation. Using two alternative proxies for the global industry-specific component of growth opportunities, we show that comparable firms with growth opportunities obtain significantly more external finance in countries with more developed financial markets. We find the effect to be economically important. Given that our sample consists of relatively large and well-established firms, which are shown to be less affected by financial development, it is likely that the economic significance of our results in the overall population is even larger.