Is full banking integration desirable?

Iván Arribas, Jesús Peiró-Palomino () and Emili Tortosa-Ausina

No 2015/05, Working Papers from Economics Department, Universitat Jaume I, Castellón (Spain)

Abstract: The aim of this paper is to analyze the links between banking integration and economic development for a sample of OECD countries. We measure banking integration considering state-of-the-art indicators that measure not only how open a banking system is but also its degree of connectedness with other banking systems. In a second stage, we plug these indicators in a model of economic growth, also controlling for other relevant variables considered by the economic growth literature. In contrast to previous initiatives, this second stage explicitly takes into account the differing levels of economic development of the countries in our sample, since the benefits of enhanced banking inte- gration might not be generalizable. To this end, we implement quantile regression, also considering the presence of endogenous regressors. Results show that bank connectedness is more important for economic development than bank openness, but the combined effect (i.e., banking integration) overall is positive and significant. Quantile regression models in the second stage of the analysis show that the effects are stronger for the poorest economies.

Keywords: banking; growth; integration; quantile regression (search for similar items in EconPapers)
JEL-codes: C21 F15 F36 F62 F65 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2015
New Economics Papers: this item is included in nep-eff
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.doctreballeco.uji.es/wpficheros/Arribas_et_al_05_2015.pdf (application/pdf)

Related works:
Journal Article: Is full banking integration desirable? (2020)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jau:wpaper:2015/05

Access Statistics for this paper

More papers in Working Papers from Economics Department, Universitat Jaume I, Castellón (Spain) Contact information at EDIRC.
Bibliographic data for series maintained by María Aurora Garcia Gallego ().