Financial Liberalization, Savings and the Banking Sector in Bangladesh

Syed Mansoob Murshed and Iftekhar Ahmed Robin

South Asia Economic Journal, 2012, vol. 13, issue 1, 69-83

Abstract: This article explores the consequences of financial liberalization policy on the banking sector in Bangladesh. Following a motivating portfolio selection theor-etical model on the impact of liberalization, it applies time series techniques with annual banking sector data for the period 1981–2008. The study suggests that the main objective of financial liberalization to promote domestic private savings by raising real interest rates has not worked. No significant positive correlation is observed between domestic private savings and the real deposit interest rate. JEL: E21, E44, E42, C22

Keywords: Financial liberalization; domestic private savings; interest rate; cointegration (search for similar items in EconPapers)
Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:sae:soueco:v:13:y:2012:i:1:p:69-83

DOI: 10.1177/139156141101300104

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