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Financial Development, Openness and Institutions: Evidence from Panel Data

Author

Listed:
  • Badi H. Baltagi

    (Syracuse University and University of Leicester)

  • Panicos O. Demetriades

    (University of Leicester)

  • Siong Hook Law

    (University Putra Malaysia)

Abstract

Utilising four annual panel datasets and dynamic panel data estimation procedures we find that trade and financial openness, as well as economic institutions are statistically important determinants of the variation in financial development across countries and over time since the 1980s. However, we find mixed support for the hypothesis that the simultaneous opening of both trade and capital accounts is necessary to promote financial development in a contemporary setting.

Suggested Citation

  • Badi H. Baltagi & Panicos O. Demetriades & Siong Hook Law, 2007. "Financial Development, Openness and Institutions: Evidence from Panel Data," WEF Working Papers 0022, ESRC World Economy and Finance Research Programme, Birkbeck, University of London.
  • Handle: RePEc:wef:wpaper:0022
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Financial development; Trade Openness; Financial Openness; Economic Institutions; Financial Liberalization; Dynamic Panel Data Analysis;
    All these keywords.

    JEL classification:

    • F19 - International Economics - - Trade - - - Other
    • G29 - Financial Economics - - Financial Institutions and Services - - - Other

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