Does financial liberalization spur growth?

Bekaert, Geert; Harvey, Campbell R.; Lundblad, Christian

doi:10.1016/j.jfineco.2004.05.007

Cited by 1,463 publications

(641 citation statements)

References 101 publications

Supporting

Mentioning

597

Contrasting

Unclassified

Order By: Relevance

“…As described above, it is defined as Δ = ln� � − ln� Even if it is hard to entirely rule out potential endogeneity issues in this setup (Bekaert et al 2005, Houston et al 2012, using differenced variables in the regressions at least alleviates endogeniety concerns, because time-invariant unobserved country-and country-pair specific factors that may affect both policy changes and changes in cross-border lending are differenced out.…”

Section: Regression Modelmentioning

confidence: 99%

Drivers of structural change in cross-border banking since the global financial crisis

Bremus

Fratzscher

2015

Journal of International Money and Finance

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may AbstractThe paper analyzes the effects of changes to regulatory policy and to monetary policy on crossborder bank lending since the global financial crisis. Cross-border bank lending has decreased, and the home bias in the credit portfolio of banks has risen sharply, especially among banks in the euro area. Our results suggest that expansionary monetary policy in the source countries -as measured by the change in reserves held at central banks -has encouraged cross-border lending, both in euro area and non-euro area countries. Regarding regulatory policy, increases in financial supervisory power or independence of the supervisory authorities have encouraged credit outflows from source countries. The findings thus underline the importance of regulatory arbitrage as a driver of crossborder bank flows since the global financial crisis. However, in the euro area, arbitrage in capital stringency was linked to lower cross-border lending since the crisis. We study the determinants of the structural changes in cross-border banking in the aftermath of the GFC. In particular, we are interested in the importance of specific push and pull factors that have been recently discussed, namely adjustments in banking regulation and the role of monetary policy in advanced countries.In a second step, we ask how the home bias in the credit portfolio of banking systems has been affected by changes in regulatory and monetary policy since the crisis. The analysis of the home bias is a complementary analysis as it takes a different perspective on the same question of the drivers of cross-border banking. Using the bilateral home bias between country pairs as the dependent variable allows us to take the portfolio decision of banks more directly into account. That is, it allows us to 2 investigate how changes to regulatory policy and monetary policy have influenced the decision of banks to invest in a particular country compared to the home country and third countries.As discussed in previous studies, differences in banking regulation may be important push or pull factors for cross-border bank claims (e.g. Houston, Lin and Ma, 2012), and hence for credit home bias. If regulatory conditions differ across countries, banks may be attracted by regions offering a less restrictive regulatory environment. A factor that could reduce cross-border lending are stricter regulatory requirements that make foreign lending more expensive. Using information o...

show abstract

Section: Regression Modelmentioning

confidence: 99%

Drivers of structural change in cross-border banking since the global financial crisis

Bremus

Fratzscher

2015

Journal of International Money and Finance

View full text Add to dashboard Cite

show abstract

“…The introduction of large foreign financial institutions boosts the level of financial development. The higher the level of financial institutions, the more superior the economic growth (Bekaert et al 2005). Luo (2012) was convinced that capital market development is regarded as the pivotal aspect of a city's financial center, including the number of firms listed, the number of securities listed, and the depth of market capitalization.…”

Section: Financial Institutions and Human Resourcesmentioning

confidence: 99%

Improving China’s Regional Financial Center Modernization Development Using a New Hybrid Madm Model

Jian-guo

Tzeng

2017

Technological and Economic Development of Economy

View full text Add to dashboard Cite

Abstract. The regional financial center is the propeller of regional economic development. Regional financial center modernization, however, has been the predominant propulsion of economic sustainability. Decisions related to regional financial center modernization development are inherent problems of multiple attribute decision-making (MADM), and strategically important to the government. The purpose of this paper is to set up a regional financial center improvement model for modernization development, as based on a hybrid MADM model, which addresses the main causal-effect factors and amended priorities in order to strengthen ongoing planning. This paper adopts a new hybrid MADM model combined with the DEMATEL technique to construct an influential network relationship map (INRM) and determined the influential weights of DANP. Then, a modified VIKOR method using influential weights is applied to measure and integrate the performance gaps from each criterion into dimensions, as well as the overall criterion for evaluating and improving the modernization development of the regional financial center, as based on INRM. Finally an empirical case study using data from the Guangzhou regional financial center is carried out as an example to demonstrate the suitability of the proposed hybrid MADM model for solving real-world problems. The results show the priorities for improvement, as based on the degree of the effect and impact of the dimensions, as follows: first is making "government policy", second is enforcing "financial infrastructure and safety", next is formulating "financial institutions and human resources", and finally "financial service".

show abstract

“…Consistent with the literature (Bekaert, Harvey, & Lundblad, 2005;Fernandes & Giannetti, 2014;Sarkissian & Schill, 2004, 2016), we include the relative level of other main economic and financial market factors such as market return, market volatility, market capitalization scaled by GDP, GDP per capita, and the growth of GDP per capita. These variables capture the relative performance, size, and growth between the host country and home country, and determine the choice made by a firm when it lists its shares overseas.…”

Section: Country Level Analysismentioning

confidence: 99%

Relative Governance and the Global Cross-Listing Decision: Extending the Bonding Hypothesis

Ferris

Liao

2017

AFR

View full text Add to dashboard Cite

The primary objective of this study is to extend the bonding hypothesis by developing what we term as the relative bonding hypothesis. We hypothesize that firms seek the advantages of stronger investor protections by listing in countries whose governance is relatively better than its own. This means that firms can achieve bonding without listing in the U.S and that the governance advantages of bonding are not only for ADRs. We investigate how relative bonding affects cross-listing behavior in the international financial markets by using a comprehensive set of cross-listings and create the relative level of governance standards between the host market and the home market. We find that firms are more likely to choose a cross-listing destination if the host country has better governance than the home country, except those firms from countries whose managers enjoy greater private benefits of control. We also find that there is valuation premium even when cross-listing occurs outside of the U.S. The premia are even stronger if the host country has better governance than that of the home country. We conclude that although bonding might explain the existence of ADRs, relative bonding helps to explain the extensive cross-listing which occurs outside of the U.S.

show abstract

Does financial liberalization spur growth?

Cited by 1,463 publications

References 101 publications

Drivers of structural change in cross-border banking since the global financial crisis

Drivers of structural change in cross-border banking since the global financial crisis

Improving China’s Regional Financial Center Modernization Development Using a New Hybrid Madm Model

Relative Governance and the Global Cross-Listing Decision: Extending the Bonding Hypothesis

Contact Info

Product

Resources

About