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Determinants of the domestic credits in developing economies: The role of political risks

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  • Gozgor, Giray

Abstract

This paper examines the determinants of the domestic credits in the panel data of 61 developing economies (22 emerging markets and 39 non-emerging developing economies) for the period from 1984 to 2016. The paper finds that the income and the money supply are positively associated with the domestic credits. There also are the negative effects of the current account balance and the interest rate differences on the domestic credits. Further analyses for the subcomponents of the overall political risk measures indicate that the better socioeconomic conditions (i.e. the less poverty, the lower unemployment, and the higher consumer confidence) and the lower corruption positively affect the domestic credits.

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  • Gozgor, Giray, 2018. "Determinants of the domestic credits in developing economies: The role of political risks," Research in International Business and Finance, Elsevier, vol. 46(C), pages 430-443.
    • Handle: RePEc:eee:riibaf:v:46:y:2018:i:c:p:430-443
    DOI: 10.1016/j.ribaf.2018.05.002
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    More about this item

    Keywords

    Credit growth; Emerging markets; Political risks; Sustainable development of the financial sector; Panel data estimation techniques;
    All these keywords.

    JEL classification:

    • E51 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Money Supply; Credit; Money Multipliers
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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