Financial Liberalization, Banking Crises and Economic Growth: The Case of South Mediterranean Countries

Ousama Ben-Salha, Tarek Bouazizi () and Chaker Aloui
Additional contact information
Tarek Bouazizi: Faculty of Economics and Management of Tunis, University Tunis El Manar, TUNISIA

Global Economy Journal (GEJ), 2012, vol. 12, issue 3, 1-22

Abstract: The central aim of this paper is to empirically assess the effects of financial liberalization on economic growth in the presence of banking crises. Our empirical investigation is based on a dynamic panel model for a sample of 10 South Mediterranean countries during the period 1980-2005. Results suggest that equity market liberalization positively affects economic growth in these countries, especially in the period of fragility and banking crises. Capital account liberalization, however, has no significant effects. As expected, banking crises exert negative effects on economic growth. When we control for the presence of macroeconomic stability and appropriate openness sequencing, the anticipated effects of capital account liberalization become significant. We conclude that macroeconomic reforms and trade opening are both crucial prerequisites for the success of the capital account liberalization process.

Keywords: financial liberalization; banking crisis; economic growth; dynamic panel data; Mediterranean economies (search for similar items in EconPapers)
Date: 2012
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.worldscientific.com/doi/abs/10.1515/1524-5861.1816
Access to full text is restricted to subscribers

Related works:
Journal Article: Financial Liberalization, Banking Crises and Economic Growth: The Case of South Mediterranean Countries (2012)
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:wsi:gejxxx:v:12:y:2012:i:03:n:1524-5861.1816

Ordering information: This journal article can be ordered from

DOI: 10.1515/1524-5861.1816

Access Statistics for this article

Global Economy Journal (GEJ) is currently edited by Joseph Pelzman

More articles in Global Economy Journal (GEJ) from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().