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Financial Reforms and International Trade

Author

Listed:
  • Munasib Abdul

    (Department of Agricultural & Applied Economics, University of Georgia, 213 Stuckey Building, 1109 Experiment Street, Griffin, GA 30223)

  • Roy Devesh

    (IFPRI, 2033 K Street, Washington, DC 20006, USA)

  • Chen Xing

    (Former phd student, Oklahoma State University, Still Water, OK.)

Abstract

We provide evidence that financial reforms (over 1976–2005) significantly affected exports, in particular, of industries with higher external capital dependence and low asset tangibility. The coverage of reforms is comprehensive, encompassing the banking sector, interest rates, equity and international capital markets. Our methodology improves upon existing studies by controlling for time-varying unobserved exporter characteristics and unobserved country-specific industry characteristics. We find significant effects of various reforms with diverse impacts by intensity. Further, event studies that incorporate possible anticipated and lagged effects of commencement of reform policies confirm the findings.

Suggested Citation

  • Munasib Abdul & Roy Devesh & Chen Xing, 2014. "Financial Reforms and International Trade," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(4), pages 1-45, October.
    • Handle: RePEc:bpj:bejeap:v:14:y:2014:i:4:p:45:n:2
    DOI: 10.1515/bejeap-2013-0104
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