The Impact of Financial Openness on Economic Integration: Evidence from the Europe and the Cis

Fabrizio Carmignani () and Abdur Chowdhury ()

No 88, Working Papers from University of Milano-Bicocca, Department of Economics

Abstract: We study whether financial openness facilitates the economic integration of formerly centrally planned economies with the EU-15. Two dimensions of economic integration are considered: cross-country convergence of per-capita incomes and bilateral trade in goods and services. We find that more financially open economies effectively catch-up faster and trade more with the EU-15. These integrationenhancing effects occur over and above any effect stemming from domestic financial deepening and other factors determining growth and trade.

Keywords: Economic integration; financial openness; gravity models; catching-up (search for similar items in EconPapers)
JEL-codes: F10 F15 F30 F36 F40 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2005-04, Revised 2005-04
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:mib:wpaper:88

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