Financial Development and Economic Growth: Experiences of Selected Developing Economies

Syed Ahmed, James Horner and Rafiqul Bhuyan Rafiq

Review of Applied Economics, 2008, vol. 04, issue 01-2, 18

Abstract: The last two decades of the twentieth century witnessed a series of financial reforms in emerging economics of Asia, Africa and Latin America. The seminal works of R.I. McKinnon and E.S. Shaw, which attribute the slow growth of these economies to financial repression, inspired many of these reforms. The McKinnon-Shaw thesis demonstrates how government regulations cause low savings and investment, and ultimately engender financial repression. Financial liberalization, in this view, creates market-based incentives and promotes economic growth. The objectives of the paper are to (1) track financial development and critically review financial liberalization measures in the emerging economies of Brazil, Mexico, and Thailand, and (2) investigate statistically the relationship between financial development and economic growth of these economies.

Keywords: Financial Economics; International Development (search for similar items in EconPapers)
Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:ags:reapec:50014

DOI: 10.22004/ag.econ.50014

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