Article
Financial Development and Financial Liberalization in Asia: Thresholds, Institutions and the Sequence of Liberalization
Economics Faculty Publications and Presentations
Document Type
Post-Print
Publication Date
6-1-2005
Subjects
- Capital markets,
- Financial globalization,
- Monetary policy -- Asia
Disciplines
Abstract
I investigate whether financial openness leads to financial development after controlling for the level of legal/institutional development, and whether trade opening is a precondition for financial opening, focusing on Asia. Utilizing a panel encompassing 87 less developed countries over the period 1980 to 2000, I find that a higher level of financial openness spurs equity market development only if a threshold level of legal development has been attained, a condition prevalent particularly among emerging market Asian countries. On the issue of sequencing, trade openness is found to be a prerequisite for successful inducement of financial development via capital account liberalization.
DOI
10.1016/j.najef.2006.06.008
Persistent Identifier
http://archives.pdx.edu/ds/psu/20336
Citation Information
Hiro Ito. "Financial Development and Financial Liberalization in Asia: Thresholds, Institutions and the Sequence of Liberalization" (2005) Available at: http://works.bepress.com/hiro_ito/21/
This is the author’s version of a work that was accepted for publication in North American Journal of Economics and Finance. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in North American Journal of Economics and Finance, issue 17(3) (December 2006). Article is available online at: https://doi.org/10.1016/j.najef.2006.06.008