Does Financial Integration Spur Economic Growth? New Evidence from the First Era of Financial Globalization

Schularick, Moritz; Steger, Thomas

doi:10.2139/ssrn.884434

Cited by 33 publications

(1 citation statement)

References 81 publications

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“…Recent evidence from the IMF by Edison et al (2002), Prasad et al (2006), Gourinchas and Jeanne (2006) all lead to the conclusion based on data from the recent era of globalization, that international financial integration may not necessarily be associated with significantly higher growth. For the historical era of globalization, Schularick and Steger (2006) however do find evidence of a positive association between gross capital flows from Britain and growth between 1880 and 1913. They confirm the traditional view of Fishlow (1986), Foreman and Peck (1994) and Collins and Williamson (2001).…”

Section: Globalization Crises Financial Development and Growthmentioning

confidence: 75%

Growing Up to Financial Stability

Bordo

2008

SSRN Journal

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Section: Globalization Crises Financial Development and Growthmentioning

confidence: 75%

Growing Up to Financial Stability

Bordo

2008

SSRN Journal

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Regional financial integration and its impact on banking development: Evidence from Southern African Development Community countries

Tembo

Makina

2020

Bus Strat Dev

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The study investigated the impact of regional financial integration on banking sector development with specific focus on the impact of the Southern African Development Community protocols on trade and finance and investment. A total of 14 countries made up the study sample, and the panel cointegration fully modified ordinary least squares model (FMOLS) alongside the generalized method of moments (GMM) were used to estimate the nature of the impact. Study findings showed that regional integration through the protocol on trade had a positive and significant impact on size and efficiency of the banking sector using the FMOLS estimator. GMM estimations for the same variables were largely insignificant. Study findings also pointed to an improvement in global financial integration indicators as a result of the trade protocol, which in turn also contributed to an increase in the level of monetization of regional financial markets. The finance and investment protocol had a positive and significant impact on private sector credit for both estimators and largely insignificant relationship with broad money. The study also observed the complimentary relationship between institutional quality and social capital in the financial development process indicating the importance of policies that strengthen sound legal systems, protect property rights, and enhance the rule of law.

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A tale of two ‘globalizations’: capital flows from rich to poor in two eras of global finance

Schularick

2006

Int. J Fin Econ

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In this paper we take a comparative look at the patterns of capital flows from rich to poor countries in two eras of financial globalization. The paper extends recent research on the developmental effects of international financial integration, long-term trends in capital mobility and 'globalization in historical perspective'. Analysing the patterns of international financial integration in the three decades of the classical gold standard and after 1990 we show that investment in developing countries was a central element of 19th century financial globalization, but plays only a minor role today. The Lucas paradox of capital failing to flow from rich to poor has grown much stronger. In historical perspective, today's financial globalization is marked by massive diversification flows between high-income economies and a relative marginalization of less-developed economies.

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Does Financial Integration Spur Economic Growth? New Evidence from the First Era of Financial Globalization

Cited by 33 publications

References 81 publications

Growing Up to Financial Stability

Growing Up to Financial Stability

Regional financial integration and its impact on banking development: Evidence from Southern African Development Community countries

A tale of two ‘globalizations’: capital flows from rich to poor in two eras of global finance

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