Differential agency cost related to the kind of financial system in each European country during the 2008 - 2014 financial crisisthe Spanish case
ISSN: 1139-5796
Año de publicación: 2021
Número: 34
Páginas: 77-104
Tipo: Artículo
Otras publicaciones en: RUE: Revista universitaria europea
Resumen
The purpose of this paper is to show the implications of the problem of agency cost depending on the economy’s financial system. There are additional and differential agency costs when the banking system is the main financial supplier in a national economy (through loans to borrowers), as opposed to agency costs in a market-based financial system (trading shares and bonds). The Spanish case is analyzed to determine the existence of such differential costs in a bank-based financial system, as it is among the largest European bank-based systems and has undergone major restructuring due to the past financial crisis.