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The Belarusian Case of Transition: Whither Financial Repression?

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  • Dr. (elect.) Julia Korosteleva
  • Dr. Colin Lawson

Abstract

The present paper examines the financial development of Belarus over the past decade with a particular focus on 1996-2002, when the financial sector was restrained through pervasive government controls in the form of interest rate ceilings, directed credit and preferential loans schemes, high reserve requirements, multiple exchange rates and capital controls. Belarus is of particular interest, as, despite no economic restructuring, the growth has averaged seven per cent per annum since 1997. While explanations of this ‘miracle’ abound, no empirical work has been done on the role of the financial system, particularly on the effects of pervasive government intervention. It has been argued that monetary stimulation of investment activity through interest rate ceilings and directed credit and preferential loans revived growth. This paper investigates whether financial policy led to financial deepening and increased the share of savings to be allocated to investment.

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  • Dr. (elect.) Julia Korosteleva & Dr. Colin Lawson, "undated". "The Belarusian Case of Transition: Whither Financial Repression?," Working Papers 2006_4, Business School - Economics, University of Glasgow.
    • Handle: RePEc:gla:glaewp:2006_4
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    Cited by:

    1. Dzmitry Kruk & Kiryl Haiduk, 2013. "The Outcome of Directed Lending in Belarus: Mitigating Recession or Dampening Long-Run Growth?," BEROC Working Paper Series 22, Belarusian Economic Research and Outreach Center (BEROC).
    2. Randolph Luca Bruno & Elodie Douarin & Julia Korosteleva & Slavo Radosevic, 2014. "Technology choices and growth: testing and expanding the propositions of new structural economics in transition economies," UCL SSEES Economics and Business working paper series 127, UCL School of Slavonic and East European Studies (SSEES), revised Oct 2014.
    3. Maksim Belitski & Julia Korosteleva & Julia Korosteleva, 2012. "Entrepreneurial Dynamics and Higher Education Institutions: Evidence from the Post-Communist World," UCL SSEES Economics and Business working paper series 120, UCL School of Slavonic and East European Studies (SSEES).

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    More about this item

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • E42 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Monetary Sytsems; Standards; Regimes; Government and the Monetary System
    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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