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Trade openness, capital inflows and financial development in developing economies.

This paper examines the impact of trade openness and capital flows on financial development in developing countries using a dynamic panel GMM estimation technique. The empirical results reveal that trade openness and capital flows are statistically significant determinants of financial development....

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Main Author: Siong, Hook Law
Format: Article
Published: Taylor & Francis 2009
Online Access:http://psasir.upm.edu.my/id/eprint/17456/
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spelling my.upm.eprints.174562015-05-14T06:58:10Z http://psasir.upm.edu.my/id/eprint/17456/ Trade openness, capital inflows and financial development in developing economies. Siong, Hook Law This paper examines the impact of trade openness and capital flows on financial development in developing countries using a dynamic panel GMM estimation technique. The empirical results reveal that trade openness and capital flows are statistically significant determinants of financial development. Simultaneous opening of both the trade and capital accounts also appear to have positive impacts on financial development. The evidence also suggests that openness leads to improved financial development through institutional quality and competition channels. However, the institutional channel outperforms competition in ensuring the positive effects of openness on financial market depth in developing countries. Taylor & Francis 2009-09 Article PeerReviewed Siong, Hook Law (2009) Trade openness, capital inflows and financial development in developing economies. International Economic Journal, 23 (3). pp. 409-426. ISSN 1016-8737 10.1080/10168730903268398
institution Universiti Putra Malaysia
building UPM Library
collection Institutional Repository
continent Asia
country Malaysia
content_provider Universiti Putra Malaysia
content_source UPM Institutional Repository
url_provider http://psasir.upm.edu.my/
description This paper examines the impact of trade openness and capital flows on financial development in developing countries using a dynamic panel GMM estimation technique. The empirical results reveal that trade openness and capital flows are statistically significant determinants of financial development. Simultaneous opening of both the trade and capital accounts also appear to have positive impacts on financial development. The evidence also suggests that openness leads to improved financial development through institutional quality and competition channels. However, the institutional channel outperforms competition in ensuring the positive effects of openness on financial market depth in developing countries.
format Article
author Siong, Hook Law
spellingShingle Siong, Hook Law
Trade openness, capital inflows and financial development in developing economies.
author_facet Siong, Hook Law
author_sort Siong, Hook Law
title Trade openness, capital inflows and financial development in developing economies.
title_short Trade openness, capital inflows and financial development in developing economies.
title_full Trade openness, capital inflows and financial development in developing economies.
title_fullStr Trade openness, capital inflows and financial development in developing economies.
title_full_unstemmed Trade openness, capital inflows and financial development in developing economies.
title_sort trade openness, capital inflows and financial development in developing economies.
publisher Taylor & Francis
publishDate 2009
url http://psasir.upm.edu.my/id/eprint/17456/
_version_ 1643826522386071552
score 13.188404

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