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financial services to
savers and investors. The contemporary bankingtheory distinguishes four main banking functions:
payment services, asset transformation, risk managementand information processing, and borrowers’monitoring (Allen and Santomero, 2001; Bhattacharyaand Thakor, 1993). This boils down to activities
like pricing assets, exercising ownership, and providingfinance. Intermediaries translate needs and
pReferences of savers and investors into appropriatefinancial services. Financial intermediaries are not
just agents who screen and monitor on behalf ofsavers but are active innovative counterparts offeringa product that cannot be offered by most individualinvestors to savers, namely the cover for risk (Merton,1995; Scholtens and Van Wensveen, 2003).Given that financial instruments are so important, itbecomes clear why there is such a crucial role for thequality of the legal system as a driver of the interactionbetween financial and economic development.
Especially, creditor rights, enforcementmechanisms and transparency are the key constituents
of the legal system (La Porta et al., 19981999).
Three transmission mechanisms link financial
development to economic growth (Pagano, 1993):
First is the way in which savings find their way toinvestments. The financial intermediary transfers a
fraction (/< 1) from savings into investments. It usesthe fraction 1) /, for example the spread for the bankbetween borrowing and lending. This may reflectmarket power or X-inefficiencies in the intermediary’sproduction process. Regulation also will affectthis fraction. If financial development reduces theleakages in the information process, it may result in arise of /, which can lead to an increase of productiongrowth. The second transmission channel is the
marginal productivity of capital. Financial intermediariescan invest in information to assess the quality
of alternative investment projects (Boyd and Prescott,1986; Greenwood and Jovanovic, 1990). Furthermore,
they can try to convince surplus households toinvest their funds in more risky but more productivetechnologies by offering risk diversification (Diamondand Dybvig, 1983; Saint-Paul, 1992). Specializedfinancial intermediaries, then, may reducethe costs of acquiring and processing information.
The resulting increase in the productivity of capitalwill result in higher economic growth. Third is theimpact on the savings rate. However, it is not clearwhether there is a positive or a negative impact offinancial development on the savings rate. With
20 Bert Scholtens

and in a culturally appropriate manner. The
EA and the EMP will take account of such
consultations, and for Category A Projects,
will be subject to independent expert review.
6. The borrower has covenanted to:
(a) Comply with the EMP in the construction
and operation of the project.
(b) Provide regular reports, prepared by inhouse
staff or third party experts, on compliance
with the EMP and
(c) where applicable, decommission the facilities
in accordance with an agreed Decommissioning
Plan.
7. As necessary, lenders have appointed an independent
environmental expert to provide
additional monitoring and reporting services.
8. In circumstances where a borrower is not in
compliance with its environmental and social
covenants, such that any debt financing
would be in default, we will engage the borrower
in its efforts to see本论文由英语论文网提供整理，提供论文代写，英语论文代写，代写论文，代写英语论文，代写留学生论文，代写英文论文，留学生论文代写相关核心关键词搜索。