skip to primary navigationskip to content

Research Seminar - Chen Lin, University of Hong Kong

When Apr 26, 2012
from 12:00 PM to 01:30 PM
Where Castle Teaching Room
Contact Name
Add event to calendar vCal

Chen Lin joined The Chinese University of Hong Kong (CUHK) in 2010 as a Full Professor in the Department of Finance. He also serves as the Director of PhD Program in Finance.

'Financial Innovation: The Bright and the Dark Sides'

“Everybody talks about financial innovation, but (almost) nobody empirically tests hypotheses about it.”
Frame and White (2004)
The financial turmoil from 2007 onwards has spurred renewed debates on the “bright” and “dark” sides of financial innovation. Using bank-, industry- and country-level data for 32, mostly high-income, countries between 1996 and 2006, this paper is the first to explicitly assess the relationship between financial innovation in the banking sector and (i) real sector growth, (ii) real sector volatility, and (iii) bank fragility. We find evidence for both bright and dark sides of financial innovation. On the one hand, we find that a higher level of financial innovation is associated with a stronger relationship between a country’s growth opportunities and capital and GDP per capita growth and with higher growth rates in industries that rely more on external financing and depend more on innovation. On the other hand, we find that financial innovation is associated with higher growth volatility among industries more dependent on external financing and on innovation and with higher idiosyncratic bank fragility, higher bank profit volatility and higher bank losses during the recent crisis.

« February 2017 »

RSS Feed Latest news

CERF PhD Scholarship competition 2017 - now closed

Nov 08, 2016

For the fifth year, Cambridge Endowment for Research in Finance is offering a scholarship scheme.

View all news

Upcoming events

Cambridge Finance Workshop - Agostino Capponi

Feb 23, 2017

Room W4.03, Cambridge Judge Business School

Cambridge Finance Workshop - H. Peyton Young

Mar 09, 2017

Room W4.03, Cambridge Judge Business School

Previous events

Upcoming events