Financial development, financial liberalization and social capital

This study uses panel data covering 82 countries for the period 1973–2008

From:
Department for International Development
Published
31 July 2017
Document Type:
Journal Article
Theme:
Economic Growth
Authors:
Elkhuizen, Luuk, Hermes, N, Jacobs, J, Meesters, A

Abstract

The relationship between financial liberalisation policies and financial development is controversial. The impact of these policies differs greatly across countries. In the literature, the quality of formal institutions has been identified as an important source of this heterogeneity, as countries with a weak institutional environment generally fail to benefit from financial liberalization. Using panel data covering 82 countries for the period 1973–2008, the authors find evidence that social capital may substitute for formal institutions as a prerequisite for effective financial liberalization policies.

This is an output from the ‘Delivering Inclusive Financial Development and Growth’ project led by the School of Oriental and African Studies (University of London)

Citation

Luuk Elkhuizen, Niels Hermes, Jan Jacobs & Aljar Meesters (2017) Financial development, financial liberalization and social capital, Applied Economics, 50:11, 1268-1288, DOI: 10.1080/00036846.2017.1358446

Financial development, financial liberalization and social capital

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Published 31 July 2017
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