Sickness insurance companies were developed in Spain by doctors and healthcare professionals, remaining outside the interests of general insurance companies. Their management was hardly professional, with limited actuarial techniques and they only accounted for a small percentage of total insurance business premiums. From the 1970s onwards, various factors changed this situation, driving processes of concentration, with numerous takeovers and mergers, first reducing the number of local and regional companies to the benefit of companies of national scope. Subsequently, the growth in demand for this type of coverage sparked the interest of national general insurance companies and multinationals, leading to a restructuring of the sector which has progressively acquired greater weight within the insurance business and become increasingly internationalised. This last stage immersed the health sector in Spain in the great processes of globalisation of the sector, characterised by a financialisation of capital promoted by the bank investment funds. These processes are little known and are the focus of analysis of this paper, with the aim of enabling comparison at international level.

Strengthening climate resilience requires farmers to select climate adaptation strategies like weather index insurance. Acknowledging that decision-making is not isolated, this study explores simultaneous peer imitation in climate adaptation choices consisting of index insurance, savings, and their interaction. We present results from a lab-in-the-field experiment that introduces innovative index insurance. Findings indicate significant and strong imitation attitudes. While the bigger peer surrounding seems relevant in the static perspective, the closer surrounding gains importance in the dynamic perspective. Additionally, credit, trust, and practical understanding stimulate adoption. Community-based extension interventions and credit-bundled products may increase index insurance diffusion and improve climate resilience.

This paper studies whether school-based financial education has spillover effects from children to parents. Leveraging data from a large-scale experiment with public high schools in Peru and credit bureau records on the parents of the youth targeted, this study measures the impact of providing personal finance lessons during secondary school on parental financial behavior. Financial education lessons in the school yield limited average spillover effects, but lead to sizable effects on parental financial behavior within disadvantaged households. Among parents from poorer households, the treatment reduces default probability by 26%, increases credit scores by 5%, and increases current debt levels by 40%. The treatment has stronger effects among the parents of daughters, who experience a significant 6.7% increase in their credit score and a 28% reduction in their loan portfolio in arrears. Among the parents of boys, most of the spillover effects are muted.

Global financial crises and potential sovereign defaults provide an opportunity for financial regulators and analysts to revise assumptions in their risk models. These conditions are also an opportunity for regulators and analysts to distinguish the ‘hyper-real’ economy, represented by derivatives, from the real economy, which requires assessment through an analysis of human as well as financial capital. Regulators are required to demonstrate that they are skilled in conducting the most thorough analysis of all elements of the finance system in order to help the investing public to manage risk as much as possible. The contribution of this article is to overview the limitations inherent in regulators’ traditional focus on financial analysis, as well as in financial analysts’ failure to consider the relevance of people management data when evaluating the potential performance of knowledge-intensive, service-based organisations. The article argues for a stronger focus on analysis of non-financial capital, including human capital, to provide a more effective ‘early warning’ of potential financial distress.

About USD7 trillion of quantitative easing funds has flooded emerging markets since 2008. These funds, created to stimulate a recovery in the Organisation for Economic Cooperation and Development and to stabilise financial markets, ended up mostly as emerging markets’ corporate bonds and loans (often after being leveraged into many multiples of their original value). Not for the first time, emerging markets became the financial markets of last resort. These funds were then either mainly invested (Asia) or used (as in Latin America and South Africa) for almost anything except for creating additional productive capacities. Enquiries into these issues, especially how corporations financed their investment, were subjects that fascinated economist Ajit Singh. He was the first to find out that corporations in emerging markets relied much more on external finance than those in the Organisation for Economic Cooperation and Development (where retained profits played a major role). The implication was that they were likely to be more susceptible to the vicissitudes of financial markets, and these have become even more weird since quantitative easing, as Northern ‘investors’, in search for elusive yields, have been happy to take on ever higher risks, leverage and illiquidity in the South. This is a key difference between current global financial fragilities and those at the onset of the current global financial crisis in 2007. The stakes for emerging economies and international financial markets could scarcely be higher, but unfortunately these huge new challenges occur at the worst possible time, as our social imagination has seldom been so barren.

We examine the impact of the rapidly expanding mobile banking service “mobile money” on rural households’ decision to adopt modern agricultural inputs and its resultant effect on agricultural income using plot, household, and community-level panel data from rural Uganda. The main findings indicate that mobile money adoption increases per capita farm income by 13%. Pathway analyses show that mobile money adoption increases the likelihood of using chemical fertilizer on maize plots by 11 percentage points. Mobile money adoption increases the likelihood of high-yielding maize seeds adoption on maize plots by 8.2 percentage points. In the Ugandan context of rapid decline in soil fertility and very low adoption of fertilizer and modern seeds, mobile money provides an avenue to finance agricultural intensification.

In this study, we examine disparities in financial development at the regional level in India. The major research questions of the study are: how do we measure the level of financial development at the sub-national level? How unequal is financial development across the states? Does it vary by ownership of financial institutions? To explore these research questions, our study develops a composite banking development index at the sub-national level for three different bank groups – public, private and foreign for 25 Indian states covering 1996–2015. Our findings suggest that despite reforms, banking development is significantly higher in the leading high income and more developed regions compared to lagging ones. Furthermore, we find that all bank groups including public banks are concentrated more in the developed regions. Overall, over the years the position of top three and bottom three states in the aggregate banking index have remained unchanged reflecting lop-sidedness of regional development. We also note improvement in the ranking of some north-eastern states during the period 2009–15.

This scoping paper addresses the role of financial institutions in empowering the British Industrial Revolution. Prominent economic historians have argued that investment was largely funded out of savings or profits, or by borrowing from family or friends: hence financial institutions played a minor role. But this claim sits uneasily with later evidence from other countries that effective financial institutions have mattered a great deal for economic development. How can this mismatch be explained? Despite numerous technological innovations, from 1760 to 1820 industrial growth was surprisingly low. Could the underdevelopment of financial institutions have held back growth? There is relatively little data to help evaluate this hypothesis. More research is required on the historical development of institutions that enabled finance to be raised. This would include the use of property as collateral. This paper sketches the evolution of British financial institutions before 1820 and makes suggestions for further empirical research. Research in this direction should enhance our understanding of the British Industrial Revolution and of the preconditions of economic development in other countries.

The purpose of this symposium is to shed light on the genealogy of the idea of a business corporation, an economic institution which has long been regarded with a mixture of awe and apprehension. Each of the four original contributions addresses the history of some of its key features. In the process, each contributor reveals some of the insights that history has to teach us regarding the central concepts that inform contemporary debates about the nature of the corporation, the contours of the corporation's purpose, the sources of corporate power, the functions of corporate law, the duties of directors, the status of shareholders, and the legitimacy of corporate rights.

This article shows that neither stock markets nor commercial banks had a significant impact on the UK's economic growth from 1850 to 1913. These results are based on a new dataset on paid-in capital of securities listed on the UK's stock exchanges, which is analysed using a vector autoregression with time-varying parameters. Econometric results also indicate that the growth of the banking sector and the capital markets was, to a significant extent, driven by factors other than domestic economic growth.

Interest payments based on income flows are a common feature of informal loans. Such so-called ’interlinked loans’ can be seen as insurance against very low disposable incomes, as interest payments are lowest when income turns out to be low. This paper examines whether interlinked loans indeed contain an insurance premium and how those premia are determined. A simple theoretical model predicts that interest rates of interlinked loans increase with income volatility when insurance premia exist. Based on data from a small-scale fishery in India, calculations show that, on average, lenders receive 25 per cent of the income, which corresponds to an average interest rate of 49 per cent p.a. A panel data analysis confirms theoretical predictions that interlinked loans contain an insurance component paid by the borrowers.

Using cross-country differences in the degree of isolation before the advent of technologies in sea and air transportation, we assess the relationship between geographical isolation and financial development across the globe. We find that prehistoric geographical isolation has been beneficial to development because it has contributed to contemporary cross-country differences in financial intermediary development. The relationship is robust to alternative samples, different estimation techniques, outliers and varying conditioning information sets. The established positive relationship between geographical isolation and financial intermediary development does not significantly extend to stock market development.

Was nineteenth-century Japan an example of finance-led growth? Using a new panel data set of firms from the Meiji period (1868–1912), this article tests whether financial sector development influenced extensive firm activity across industries and locations. Results from a two-stage least squares first difference model suggest that financial intermediation is associated with additional net firm establishment, particularly in light manufacturing sectors like textiles. The overall effect is muted in the latter part of the period and among peripheral regions, which may underscore the respective roles of institutions and agglomeration economies in later stages of development.

This paper assumes, with Perez (1983, 2002), that technological development follows a ‘long wave’ rhythm, in which new ‘techno-economic paradigms’ succeed one another at long intervals; the latest being the Information and Communication Technology (ICT) paradigm. When the new paradigm appears a tension develops between it and the existing socio-institutional framework. We argue that the financial and corporate governance system (FCGS), is a key element of that framework which is unusually resistant to change. The focus is on the UK FCGS, an outsider-dominated/stockexchange-based system, though with comparisons with the US and with ‘insider-dominated’ economies. Based on fieldwork conducted between 1999 and 2005, we find that Britain is still a long way from witnessing a new creative partnership of financial and industrial capital in most of the economy, needed to fully release the potential of the new paradigm. We discuss what form that might take.