Financial Development

Overview: The Department

International Economics

Research Area

Financial Development

Research profile

Financial Development will examine the impact of the increasing globalization of financial markets on people in developing and emerging economies. Here, the examination takes place at the micro-level—that is, it brings the decisions made by households and companies, and their responses to the impact of globalized financial markets, to the forefront. Among the central themes are questions of so-called “financial literacy,” i.e. the skillful handling and understanding of finances. Included in this area of focus is the current DFG project “Individual Risk Attitudes in Rural Thailand and Vietnam,” which examines the financial behavior of these countries’ rural populations based on a combination of survey data and field experiments. The project examines their access to financial services, the key parameters that determine risk attitudes when making financial decisions, and the role of financial literacy. The aim of the research in this area is to gain a better understanding of how humans behave when dealing with finance and financial products, and thus determine how financial markets’ institutions and structures can be organized more purposefully. These issues will be examined methodically from an applied microeconomic perspective using individual and household data from developing and emerging countries. This research will be supplemented by field experiments.