.regulatory settings that maintain excessively high barriers to competition in banking, or that provide too little protection for investors in securities markets, hamper the development of financial systems, resulting in weaker economic growth." Thus, a balance must be struck between competition and the protection of investors.
This is of particular importance for firms that are growing rapidly and that depend on injections of outside capital, such as those specialized in information technology and biotechnology. This suggests that the quality of the financial sector is reflected in the industrial structure of an economy, and not only in its growth rate. 1  OECD. 2006. "Regulation of Financial Systems and Economic Growth."