Financial Development, Openness and Institutions: Evidence from Panel Data

Badi Baltagi, Panicos Demetriades and Siong Hook Law

No 22, WEF Working Papers from ESRC World Economy and Finance Research Programme, Birkbeck, University of London

Abstract: Utilising four annual panel datasets and dynamic panel data estimation procedures we find that trade and financial openness, as well as economic institutions are statistically important determinants of the variation in financial development across countries and over time since the 1980s. However, we find mixed support for the hypothesis that the simultaneous opening of both trade and capital accounts is necessary to promote financial development in a contemporary setting.

Keywords: Financial development; Trade Openness; Financial Openness; Economic Institutions; Financial Liberalization; Dynamic Panel Data Analysis (search for similar items in EconPapers)
JEL-codes: F19 G29 (search for similar items in EconPapers)
Date: 2007-05
New Economics Papers: this item is included in nep-dev, nep-fdg and nep-int
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Citations: View citations in EconPapers (43)

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Related works:
Working Paper: Financial Development, Openness and Institutions: Evidence from Panel Data (2007)
Working Paper: Financial Development, Openness and Institutions: Evidence from Panel Data (2007)
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