How do financial development and financial integration interact? We focus on Japan’s Great Recession after 1990 to study this question. Regional differences in banking integration affected how the recession spread across the country: financing frictions for credit-dependent firms were more severe ...
Keywords:
financial development, financial integration, Japan, Great Recession, Lost Decade, banking integration, regional business cycles, transmission of financial shocks, misallocation of credit, trade credit, export finance, silk industry
