International Financial Liberalization and Industry Growth

Jonas Vlachos and Daniel Waldenström

No 513, SSE/EFI Working Paper Series in Economics and Finance from Stockholm School of Economics

Abstract: The growth effects of international financial liberalization and integration are investigated using the methodology and data developed by Rajan and Zingales (1998). The main result is that industries highly dependent on external financing do not experience higher growth in value added in countries with liberalized financial markets. Liberalization does, however, increase the growth rates of both production and firm creation among externally dependent industries – given that countries have reached a relatively high level of financial development. These results are consistent both with increased competition and increased outsourcing. Some preliminary evidence point towards the latter explanation.

Keywords: Financial liberalization; Financial integration; Economic growth (search for similar items in EconPapers)
JEL-codes: F30 G10 O40 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2002-11-14
New Economics Papers: this item is included in nep-cfn, nep-com and nep-mfd
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Related works:
Journal Article: International financial liberalization and industry growth (2005)
Working Paper: International Financial Liberalization and Industry Growth (2002)
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:hastef:0513

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