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The article focuses on the main issues of regulating and supervising banks in emerging markets with a view toward evaluating the long-run options, particularly in Latin America and East Asia. These economies face a severe policy commitment problem that leads to excessive bailouts and potential devaluation of claims of foreign investors. The paper reviews the tradeoffs imposed by external discipline and examines various proposed arrangements.

The generation, diffusion, absorption, and application of new technology, knowledge, or ideas are crucial drivers of development. The authors examine the exceptionally fast growth in domestic innovation efforts in Korea, Taiwan (China), Singapore, and China, drawing on information about R&D as well as patent and patent citations data. They also use the World Bank Investment Climate Surveys to investigate sources of technological innovation in the other middle- and low-income East Asian economies. They then evaluate the role of three main channels for knowledge flows to East Asia—international trade, acquisition of disembodied knowledge, and foreign direct investment. Results from estimating an international knowledge diffusion model using patent citations data show that, while East Asian innovations continue to draw heavily on knowledge flows from the US and Japan, citations to the same or to other East Asian economies are quickly rising, indicating the emergence of national and regional knowledge stocks as a foundation for innovation. [ABSTRACT FROM AUTHOR]

Compares the growth and financing patterns of East Asian corporations with other countries before the 1997 financial crisis. Influence of a weak financial structure on company performance; Differences in the rate of return on assets among East Asian corporations; Maturity of debt structures of East Asian companies compared with European and Latin American countries.

Structural change is a vital element of successful development. Between 1985 and 2015, however, falling barriers to trade and transfer of technology shifted sectoral structures in different directions in different countries by intensifying endowment-related specialization. In skill-abundant developed countries, manufacturing became more skill-intensive and employed fewer workers. In land-scarce developing East Asia, labor-intensive manufacturing expanded, especially and hugely in China. In land-abundant Africa, Latin America, and the Middle East, by contrast, manufacturing shares fell, while in land-scarce South Asia labor-intensive manufacturing was constrained by low literacy and inadequate infrastructure. This pattern of structural change contributed to higher average growth rates during this period in land-scarce than in land-abundant developing countries. Future changes in sectoral structures and growth rates will continue to be shaped by differences among countries in land abundance and skill supplies that matter for development policy choices. [ABSTRACT FROM AUTHOR]