  This paper investigates some indicators of financial development in select
countries with currency board systems and raises some questions about the
connection between financial development and growth in currency board systems.
Most of those cases are long past episodes of what we would now call emerging
markets. However, the paper also looks at Hong Kong, the currency board system
that is one of the world's largest and most advanced financial markets. The
global financial crisis of 2008 09 created doubts about the efficiency of
financial markets in advanced economies, including in Hong Kong, and unsettled
the previous consensus that a large financial sector would be more stable than
a smaller one.
