Colombia’s System of National Development Banks

2018 ◽  
Author(s):  
José Antonio Ocampo ◽  
Paola Arias
Keyword(s):  
Market Failure ◽  
Local Development ◽  
National Development ◽  
Financial Inclusion ◽  
Market Failures ◽  
Major Market ◽  
Entrepreneurial Growth ◽  
Development Banks ◽  
Specialized Institutions

The major feature of Colombia’s national development banks is that they constitute a system of multiple, specialized institutions, created at different times to promote sectors that were considered strategic for the country’s development. This chapter analyses the characteristics of the system of national development banks in Colombia currently composed of four specialized institutions: FDN (for infrastructure), FINDETER (local development), BANCOLDEX (industry and foreign trade), and FINAGRO (agriculture). The chapter explores the history, current structure, and main features of the system. It also looks at how the system is managing three major market failures: infrastructure financing (the major case of market failure in long-term financing), financial inclusion, and the promotion of entrepreneurial growth.

scholarly journals The Future of National Development Banks

2018 ◽  
Author(s):  
Stephany Griffith-Jones ◽  
José Antonio Ocampo ◽  
Felipe Rezende ◽  
Alfredo Schclarek ◽  
Michael Brei
Keyword(s):  
Climate Change ◽  
Global Financial Crisis ◽  
National Development ◽  
Theoretical Background ◽  
Financial Inclusion ◽  
Infrastructure Investment ◽  
Key Features ◽  
Development Banks ◽  
The Global Financial Crisis ◽  
Valuable Role

In the wake of the global financial crisis, there is growing consensus that national development banks play a valuable role in development finance. This chapter looks first at the theoretical background justifying the need for development banks. The chapter then describes empirically some of the key features of national development banks, including their lending and funding structure. Finally, it analyses in depth five main functions which national development banks perform: (i) providing countercyclical lending; (ii) promoting innovation and structural transformation; (iii) enhancing financial inclusion; (iv) supporting infrastructure investment; and (v) supporting the provision of public goods, and particularly combatting climate change.

Pflege und Gesundheit – zwei ungleiche Schwestern?

2007 ◽  
Vol 58 (2) ◽  
Author(s):  
Torsten Sundmacher
Keyword(s):  
Social Insurance ◽  
Market Failure ◽  
Long Term Care ◽  
Service Providers ◽  
Social Health Insurance ◽  
Market Failures ◽  
Term Care ◽  
The Social ◽  
Long Term Care Insurance

SummaryThe Social Long-term Care Insurance (Gesetzliche Pflegeversicherung, GPV) is in a crisis which will clearly intensify without reforms. An important solution strategy is the introduction of competition elements. This concerns the competition between the Long-term Care Insurance as well as the competition between the service providers. In comparison to the Social Health Insurance (Gesetzliche Krankenvereicherung, GKV) this coordination procedure can be found up to now very rarely. It is examined with the help of the market failure theory which market problems can be found in the area of long-term care. Here, nursing goods as well as the market for nursing insurances are examined. In comparison to the GKV, the lacking consumer’s sovereignty and problems with principal-agent-relations aggravate the situation in the GPV. However, other market failures are rather less important. An enlarged discussion of differences between GPV and GKV leads to the question of the institutional arrangement. This concerns on the one hand the possible amount of market and competition in the GPV as well as, on the other hand, the relation between GKV and GPV. In particular the interface problems between both social insurance systems are discussed.

National Development Finance in Middle-Income Countries

2020 ◽  
pp. 233-251
Author(s):  
Stephany Griffith-Jones
Keyword(s):  
Development Strategy ◽  
Developing Economies ◽  
National Development ◽  
Sustainable Growth ◽  
Financial Inclusion ◽  
Middle Income ◽  
Middle Income Countries ◽  
Development Banks ◽  
Privately Financed ◽  
Combat Climate Change

This chapter focuses on the roles of National Development Banks (NDBs) in emerging and developing economies. They finance investment in sectors key for dynamic and sustainable growth, both through their own lending, and by catalyzing private finance. For NDBs to contribute significantly to avoiding a middle-income trap, there are several conditions: they must be “good,” well-run development banks, their scale must be sufficiently large to help meet investment needs on a significant scale, and there must be a clear national development strategy, for NDBs to implement. This chapter stresses NDBs contribution to financing investment in innovative sectors and infrastructure. This is complementary to supporting provision of public goods, particularly investments that help combat climate change and financial inclusion. NDBs should provide counter-cyclical financing in the busts, when privately-financed investment tends to decline and NDB lending increases to help maintain crucial investment, and in booms, when lending by NDBs should slow down.

Development banks in BRICS

2020 ◽  
pp. 188-204
Author(s):  
John Weiss
Keyword(s):  
Private Sector ◽  
Financial Institutions ◽  
Financial Inclusion ◽  
Academic Literature ◽  
The Common ◽  
Development Banks

The use of development banks as a source of long-term funding is one of the common characteristics of BRICS economies. This chapter summarizes data on the extent of the involvement of such banks and reviews the key objectives identified for such banks in the academic literature—in particular their role in terms of strategic lending and financial inclusion. The experience of the Brazilian bank Banco Nacional de Desenvolvimento Econômico e Social is used as a case study. This bank has played a major role in the Brazilian economy as a source of long-term credit, although critics have pointed to a focus on large borrowers and its possible impact in stifling the emergence of private sector financial institutions.

Barriers to Energy Efficiency: More Than Just Market Failure

1997 ◽  
Vol 8 (1) ◽  
pp. 25-43 ◽  
Author(s):  
Nick Eyre
Keyword(s):  
Energy Efficiency ◽  
Market Failure ◽  
Energy Use ◽  
Market Failures ◽  
Short Term ◽  
Market Structures ◽  
Underlying Causes ◽  
Technology Market ◽  
Barriers To Energy Efficiency

The importance to environmental policy of improving energy efficiency is now widely agreed. It is also well established that levels of energy efficiency are below the optimum for economic efficiency, i.e. there are market barriers to energy efficiency. Neo-c1assical economic theory provides a taxonomy of the barriers in terms of market failure and can evaluate short term policy options to address them. However, this paradigm does not explain the underlying causes or why all the market failures act in the direction of lower energy efficiency. Economic analysis alone cannot identify long term, sustainable approaches to removing the barriers; input is needed from other disciplines. A review of the multi-disciplinary literature identifies some common elements in the nature of the barriers: a dichotomy between producers and consumers, centralisation in energy supply and planning, a commodity view of energy, and complexity of energy efficiency markets. It is concluded that these are fundamental characteristics of energy use in a modem economy. They constitute a meta-barrier - a framework in which the other barriers can be described. Barriers to energy efficiency therefore remain deeply entrenched and, in the short term, optimisation of energy efficiency is unlikely. However, future changes in technology, market structures and institutions may open new opportunities to address the fundamental problems in the longer term.

Market Maker: The Role of China Development Bank in Incubating Market

2017 ◽  
Vol 4 (2) ◽  
Author(s):  
Jiajun Xu
Keyword(s):  
Urban Infrastructure ◽  
Political Influence ◽  
Market Failures ◽  
Development Bank ◽  
State And Market ◽  
Development Banks ◽  
Infrastructure Investments ◽  
China Development

AbstractThe present paper aims to use the case of China Development Bank (CDB) to tackle the fundamental question of why development banks in an effort to shed light on the broader debate about the role of state in economic development. By delving deeper into the role of CDB in incubating the market for long-term urban infrastructure investments, it argues that development banks can play an indispensable role in incubating markets especially in developing and transition economies where capital markets are underdeveloped and market institutions are flawed. This perspective goes beyond the conventional approach to justifying why development banks, i. e., fixing market failures. It further argues that realizing the role of market incubation requires at least two conditions: building “firewalls” within development banks to resist undue political influence; and designing incentives for development banks to exit when markets are mature in order to avoid suppressing financial development and crowding out private capital. It concludes that well-managed development banks can help to create synergies between state and market by incubating markets.

Quality Regulation

2019 ◽  
pp. 307-353
Author(s):  
Sheilagh Ogilvie
Keyword(s):  
Market Failure ◽  
Market Failures ◽  
Information Asymmetries ◽  
Goods And Services ◽  
Major Market ◽  
Quality Regulation ◽  
Shed Light

This chapter examines one major market failure that guilds might have helped solve: the potential for information asymmetries between producers and consumers about the quality of goods and services. Many guilds erected market regulations. To address such concerns, guilds required producers and products to be guild-certified, inspected workshops or wares, and penalized quality violations. Guilds also engaged in many unrelated activities which affected quality unintentionally. The chapter then assesses the evidence on information asymmetries about quality, the institutional mechanisms available to solve them, and the outcomes in different sectors of the European economy. It argues that guilds shed light on the balance between market failures, state failures, and the failure of particularized institutions in intermediating between producers and consumers.

National Development Banks and Mission-Oriented Finance for Innovation

2018 ◽  
Author(s):  
Mariana Mazzucato ◽  
Caetano C. R. Penna
Keyword(s):  
Market Failure ◽  
National Development ◽  
The State ◽  
Private Investments ◽  
Crowd Out ◽  
Development Banks ◽  
The Relationship

How can one conceptualize the new ‘mission-oriented’ role assumed by national development banks (NDBs)? The standard ‘market failure’ perspective provides only a partial and limited justification for what NDBs do and does not explain historical and contemporary developments. This chapter combines insights from Keynes, Minsky, Schumpeter, and Polanyi (and works in their tradition) to review the old and new roles of NDBs. It discusses these roles taking into account two important dimensions: (i) the relationship between risks and rewards, and (ii) the criticisms that NDBs crowd out private investments. It shows that the roles typically performed by NDBs go beyond that of the state as ‘market fixer’ to assume that of market shaper and creator.

A Guidebook for National Development Banks on Climate Risk

2021 ◽  
Author(s):  
Maria E. Netto de A. C. Schneider ◽  
Rodrigo Pereira Porto ◽  
Maria Chiara Trabacchi ◽  
Signi Schneider ◽  
Sara Harb ◽  
...  
Keyword(s):  
Portfolio Management ◽  
Financial Risk ◽  
Task Force ◽  
National Development ◽  
Climate Risk ◽  
Climate Risks ◽  
Financial Disclosures ◽  
Development Banks ◽  
Lending Decisions

This guidebook provides national development banks (NDBs) a roadmap to integrating climate risk into their lending strategies and portfolio management in accordance with the recommendations of the Task Force on Climate-related Financial Disclosures. The journey from little action on climate to becoming climate capable allows an NDB to better understand the financial risk to itself and its clients arising from climate change, and allows it to capture new opportunities. Making climate-informed investment and lending decisions and, in the long term, allocating capital in a manner that aligns with the global curbing of emissions is good business. This guidebook is written for those NDBs heeding the call to address the climate challenges in their countries as well as to raise awareness of the urgency to act on climate risks among those that are new to the topic. NDBs, as financial institutions, need to address the potential impacts on their existing and future portfolios and financial positions.

Discontinuous Institutional Alternatives in the Context of Economy Deregulation

2004 ◽  
pp. 94-110 ◽  
Author(s):  
A. Shastitko
Keyword(s):  
Market Failure ◽  
Transaction Management ◽  
Market Failures ◽  
Relative Cost ◽  
State Participation

Various ways of state participation in the mechanisms of transaction management are considered in the article. Differences between compensation and elimination of the market failures are identified. Opportunities and risks of non-regulatory alternatives usage as a mean of market failure compensation are described. Based on classification of goods correlated to relative cost of their useful characteristics evaluation (search, experience, merit) questions of institutional alternatives in three areas (political, financial and commodity) are examined.

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