Financial Liberalization and Business Cycles: The Experience of Countries in the Baltics and Central Eastern Europe
AbstractThis paper extends the work of Kaminsky and Schmukler (2003) to the Baltic and Central Eastern European future Member States of the European Union, to test if the same short-run increase in cyclical volatility arising from financial integration is observed in this specific sample of ?emerging markets?. This work finds some signs that, contrary to other emerging markets, this does not happen: for the future Member States, financial integration, similarly to the outcome observed in mature market economies, reduces cyclical volatility both in the short and in the long run. Weak indications are found that this may happen partially due to the anchoring of expectations provided by the EU Accession, and to the more robust institutional framework imposed by this process onto the countries in question. --
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Bibliographic InfoPaper provided by Deutsche Bundesbank, Research Centre in its series Discussion Paper Series 1: Economic Studies with number 2004,23.
Date of creation: 2004
Date of revision:
Enlargement; European Union; financial liberalization; booms; busts; cycles; Bry-Boschan; volatility;
Find related papers by JEL classification:
- F34 - International Economics - - International Finance - - - International Lending and Debt Problems
- F02 - International Economics - - General - - - International Economic Order; Noneconomic International Organizations;; Economic Integration and Globalization: General
- F30 - International Economics - - International Finance - - - General
- F33 - International Economics - - International Finance - - - International Monetary Arrangements and Institutions
- F32 - International Economics - - International Finance - - - Current Account Adjustment; Short-term Capital Movements
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
- P20 - Economic Systems - - Socialist Systems and Transition Economies - - - General
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- Lavinia Cristescu, 2009. "The Effect of Capital Market Liberalization in Eastern Europe: Economic Growth or Financial Crisis," Advances in Economic and Financial Research - DOFIN Working Paper Series, Bucharest University of Economics, Center for Advanced Research in Finance and Banking - CARFIB 30, Bucharest University of Economics, Center for Advanced Research in Finance and Banking - CARFIB.
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