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Private Investment and Financial Sector Policies in India and Malaysia

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  • Ang, James B.

Abstract

Summary This paper examines the role of financial sector policies in determining private investment in the economies of India and Malaysia. The results suggest that significant directed credit programs favoring certain priority sectors tend to discourage private capital formation in both countries. Interest rate controls appear to have a positive impact on private investment, with the effect being more pronounced in Malaysia. While high reserve and liquidity requirements exert a negative influence on private investment in India, the effect is found to be positive in Malaysia.

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Bibliographic Info

Article provided by Elsevier in its journal World Development.

Volume (Year): 37 (2009)
Issue (Month): 7 (July)
Pages: 1261-1273

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Handle: RePEc:eee:wdevel:v:37:y:2009:i:7:p:1261-1273

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Web page: http://www.elsevier.com/locate/worlddev

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Keywords: private investment financial sector policies India Malaysia;

References

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Citations

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Cited by:
  1. Anwar, Sajid & Sun, Sizhong, 2011. "Financial development, foreign investment and economic growth in Malaysia," Journal of Asian Economics, Elsevier, vol. 22(4), pages 335-342, August.
  2. Ang, James B., 2010. "Financial Reforms, Patent Protection, and Knowledge Accumulation in India," World Development, Elsevier, vol. 38(8), pages 1070-1081, August.
  3. Abdul Karim, Zulkefly, 2010. "Monetary policy and firms’ investment: Dynamic panel data evidence from Malaysia," MPRA Paper 23962, University Library of Munich, Germany, revised 15 May 2010.
  4. Ang, James B., 2010. "Research, technological change and financial liberalization in South Korea," Journal of Macroeconomics, Elsevier, vol. 32(1), pages 457-468, March.
  5. Ang, James & Sen, Kumal, 2009. "Private Saving in India and Malaysia Compared: The Role of Financial Liberalization and Expected Pension Benefits," MPRA Paper 14413, University Library of Munich, Germany.
  6. Babajide Fowowe, 2011. "Financial Sector Reforms And Private Investment In Sub-Saharan African Countries," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 36(3), pages 79-97, September.
  7. Asongu Simplice, 2012. "Linkages between Investment Flows and Financial Development: Causality Evidence from Selected African Countries," Working Papers 12/029, African Governance and Development Institute..
  8. Tan, Bee Wah & Tang, Chor Foon, 2011. "The dynamic relationship between private domestic investment, the user cost of capital, and economic growth in Malaysia," MPRA Paper 27964, University Library of Munich, Germany.
  9. Ang, James B., 2011. "Finance and consumption volatility: Evidence from India," Journal of International Money and Finance, Elsevier, vol. 30(6), pages 947-964, October.
  10. Anwar, Sajid & Cooray, Arusha, 2012. "Financial development, political rights, civil liberties and economic growth: Evidence from South Asia," Economic Modelling, Elsevier, vol. 29(3), pages 974-981.

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