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The Impact of the Global Financial Crisis on the Economic Development in the Eurasian Region

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  • Ketenci, Natalya

Abstract

This study presents an empirical analysis of the impact of the global financial crisis on the economic development of the Eurasian region. The region covers fifteen states of the former Soviet Union: Armenia, Azerbaijan, Belarus, Estonia, Georgia, Kazakhstan, Kyrgyz Republic, Latvia, Lithuania, Moldova, Russian Federation, Tajikistan, Turkmenistan, Ukraine, Uzbekistan. Emerging economies of estimated countries are highly attractive for foreign investors, who stimulate economic growth in the region. This paper particularly investigates the relationship between economic growth and international capital flows in the Eurasian region before and after the global financial crisis. Panel estimations using annual data for the period 1990-2014 are made applying the Generalized Method of Moments estimation technique for the dynamic panel data, developed by Hansen (1982). Empirical results reveal that the main determinant of the regions’ economic development is FDI inflow. This study finds evidence that after the global financial crisis, economic growth in the region becomes more responsive to capital flows compared to the pre-crisis period.

Suggested Citation

  • Ketenci, Natalya, 2017. "The Impact of the Global Financial Crisis on the Economic Development in the Eurasian Region," MPRA Paper 83780, University Library of Munich, Germany, revised 2017.
    • Handle: RePEc:pra:mprapa:83780
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    More about this item

    Keywords

    Economic growth; capital flows; generalized method of moments (GMM); Eurasia; dynamic panel data.;
    All these keywords.

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies

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