Banking Sector Openness and Economic Growth

Banking sector openness may directly affect growth by improving the access to financial services and indirectly by improving the efficiency of financial intermediaries, both of which reduce the cost of financing, and in turn, stimulate capital accumulation and economic growth. The objective of the p...

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Main Authors:	Bayraktar, Nihal, Wang, Yan
Format:	Policy Research Working Paper
Language:	English en_US
Published:	World Bank, Washington, DC 2012
Subjects:	ACCOUNTING ACTUAL COST ALLOCATIVE EFFICIENCY AUDITING BANK ASSETS BANK OF KOREA BANKING SECTOR BANKING SERVICES BORROWING CAPACITY BUILDING CAPITAL ACCUMULATION CAPITAL FLIGHT CAPITAL INVESTMENT CAPITAL MOBILITY COMPETITIVENESS CONSTANT RETURNS TO SCALE CONSUMERS COST OF CAPITAL COUNTRY LEVEL DEBT DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DOMESTIC CREDIT DYNAMIC PANEL EARNING ASSETS ECONOMETRICS ECONOMIC GROWTH ECONOMIC LITERATURE ECONOMIC STATISTICS ECONOMIC STUDIES EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL MODEL EMPIRICAL RESULTS EMPIRICAL SECTION EMPIRICAL STUDIES EMPLOYMENT EMPLOYMENT EQUATIONS ENTREPRENEURSHIP EQUATIONS ERROR TERM ERROR TERMS ESTIMATED COEFFICIENTS ESTIMATION METHOD ESTIMATION RESULTS EXPECTED RETURNS EXPECTED VALUE EXPLANATORY VARIABLES FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL INTEGRATION FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIARY DEVELOPMENT FINANCIAL INTERMEDIATION FINANCIAL LIBERALIZATION FINANCIAL MARKETS FINANCIAL REGULATION FINANCIAL SECTOR FINANCIAL SERVICES FOREIGN BANKS FOREIGN ENTRY FUNCTIONAL FORM GDP GDP PER CAPITA GLOBALIZATION GROWTH IMPACT GROWTH LITERATURE GROWTH MODEL GROWTH MODELS GROWTH RATE GROWTH REGRESSIONS HIGH INFLATION HUMAN CAPITAL IMPROVING PRODUCTIVITY INDEPENDENT VARIABLES INFLATION INFLATION RATE INTEREST INCOME INTEREST RATE INTEREST RATES INTERNATIONAL COMPETITION INVESTMENT RATE LAGGED LEVELS LAWS LIBERALIZATION OF FINANCIAL MARKETS LIQUIDITY LONG-RUN GROWTH LOW INTEREST RATES LOWERING BARRIERS MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MARKET FAILURES MONETARY ECONOMICS NAFTA NEGATIVE EFFECT NEGATIVE SIGN NET INTEREST MARGIN 0 HYPOTHESIS OVERHEAD COSTS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS PRODUCTION FUNCTION PRODUCTIVITY PRODUCTIVITY GROWTH PROFIT RATE PROFITABILITY PROMOTING GROWTH PUBLIC INFRASTRUCTURE REAL GDP REAL INTEREST RATE REAL INTEREST RATES RETAINED EARNINGS RISK FACTORS RISK SHARING SAVINGS SERIAL CORRELATION SIGNIFICANT IMPACT STATE BANKS TRADE LIBERALIZATION TRANSITION ECONOMIES
Online Access:	http://documents.worldbank.org/curated/en/2006/10/7095002/banking-sector-openness-economic-growth http://hdl.handle.net/10986/9273

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recordtype	oai_dc
spelling	okr-10986-92732021-04-23T14:02:41Z Banking Sector Openness and Economic Growth Bayraktar, Nihal Wang, Yan ACCOUNTING ACTUAL COST ALLOCATIVE EFFICIENCY AUDITING BANK ASSETS BANK OF KOREA BANKING SECTOR BANKING SERVICES BORROWING CAPACITY BUILDING CAPITAL ACCUMULATION CAPITAL FLIGHT CAPITAL INVESTMENT CAPITAL MOBILITY COMPETITIVENESS CONSTANT RETURNS TO SCALE CONSUMERS COST OF CAPITAL COUNTRY LEVEL DEBT DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DOMESTIC CREDIT DYNAMIC PANEL EARNING ASSETS ECONOMETRICS ECONOMIC GROWTH ECONOMIC LITERATURE ECONOMIC STATISTICS ECONOMIC STUDIES EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL MODEL EMPIRICAL RESULTS EMPIRICAL SECTION EMPIRICAL STUDIES EMPLOYMENT EMPLOYMENT EQUATIONS ENTREPRENEURSHIP EQUATIONS ERROR TERM ERROR TERMS ESTIMATED COEFFICIENTS ESTIMATION METHOD ESTIMATION RESULTS EXPECTED RETURNS EXPECTED VALUE EXPLANATORY VARIABLES FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL INTEGRATION FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIARY DEVELOPMENT FINANCIAL INTERMEDIATION FINANCIAL LIBERALIZATION FINANCIAL MARKETS FINANCIAL REGULATION FINANCIAL SECTOR FINANCIAL SERVICES FOREIGN BANKS FOREIGN ENTRY FUNCTIONAL FORM GDP GDP PER CAPITA GLOBALIZATION GROWTH IMPACT GROWTH LITERATURE GROWTH MODEL GROWTH MODELS GROWTH RATE GROWTH REGRESSIONS HIGH INFLATION HUMAN CAPITAL IMPROVING PRODUCTIVITY INDEPENDENT VARIABLES INFLATION INFLATION RATE INTEREST INCOME INTEREST RATE INTEREST RATES INTERNATIONAL COMPETITION INVESTMENT RATE LAGGED LEVELS LAWS LIBERALIZATION OF FINANCIAL MARKETS LIQUIDITY LONG-RUN GROWTH LOW INTEREST RATES LOWERING BARRIERS MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MARKET FAILURES MONETARY ECONOMICS NAFTA NEGATIVE EFFECT NEGATIVE SIGN NET INTEREST MARGIN 0 HYPOTHESIS OVERHEAD COSTS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS PRODUCTION FUNCTION PRODUCTIVITY PRODUCTIVITY GROWTH PROFIT RATE PROFITABILITY PROMOTING GROWTH PUBLIC INFRASTRUCTURE REAL GDP REAL INTEREST RATE REAL INTEREST RATES RETAINED EARNINGS RISK FACTORS RISK SHARING SAVINGS SERIAL CORRELATION SIGNIFICANT IMPACT STATE BANKS TRADE LIBERALIZATION TRANSITION ECONOMIES Banking sector openness may directly affect growth by improving the access to financial services and indirectly by improving the efficiency of financial intermediaries, both of which reduce the cost of financing, and in turn, stimulate capital accumulation and economic growth. The objective of the paper is to empirically reinvestigate these direct and indirect links using a more advanced econometric technique (GMM dynamic panel estimators). An illustrative model is presented to link financial market development with investment. The empirical results confirm the presence of direct and indirect links, and thus provide support for countries planning to open their banking sector for international competition. 2012-06-26T18:21:28Z 2012-06-26T18:21:28Z 2006-10 http://documents.worldbank.org/curated/en/2006/10/7095002/banking-sector-openness-economic-growth http://hdl.handle.net/10986/9273 English en_US Policy Research Working Paper; No. 4019 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ACCOUNTING ACTUAL COST ALLOCATIVE EFFICIENCY AUDITING BANK ASSETS BANK OF KOREA BANKING SECTOR BANKING SERVICES BORROWING CAPACITY BUILDING CAPITAL ACCUMULATION CAPITAL FLIGHT CAPITAL INVESTMENT CAPITAL MOBILITY COMPETITIVENESS CONSTANT RETURNS TO SCALE CONSUMERS COST OF CAPITAL COUNTRY LEVEL DEBT DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DOMESTIC CREDIT DYNAMIC PANEL EARNING ASSETS ECONOMETRICS ECONOMIC GROWTH ECONOMIC LITERATURE ECONOMIC STATISTICS ECONOMIC STUDIES EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL MODEL EMPIRICAL RESULTS EMPIRICAL SECTION EMPIRICAL STUDIES EMPLOYMENT EMPLOYMENT EQUATIONS ENTREPRENEURSHIP EQUATIONS ERROR TERM ERROR TERMS ESTIMATED COEFFICIENTS ESTIMATION METHOD ESTIMATION RESULTS EXPECTED RETURNS EXPECTED VALUE EXPLANATORY VARIABLES FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL INTEGRATION FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIARY DEVELOPMENT FINANCIAL INTERMEDIATION FINANCIAL LIBERALIZATION FINANCIAL MARKETS FINANCIAL REGULATION FINANCIAL SECTOR FINANCIAL SERVICES FOREIGN BANKS FOREIGN ENTRY FUNCTIONAL FORM GDP GDP PER CAPITA GLOBALIZATION GROWTH IMPACT GROWTH LITERATURE GROWTH MODEL GROWTH MODELS GROWTH RATE GROWTH REGRESSIONS HIGH INFLATION HUMAN CAPITAL IMPROVING PRODUCTIVITY INDEPENDENT VARIABLES INFLATION INFLATION RATE INTEREST INCOME INTEREST RATE INTEREST RATES INTERNATIONAL COMPETITION INVESTMENT RATE LAGGED LEVELS LAWS LIBERALIZATION OF FINANCIAL MARKETS LIQUIDITY LONG-RUN GROWTH LOW INTEREST RATES LOWERING BARRIERS MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MARKET FAILURES MONETARY ECONOMICS NAFTA NEGATIVE EFFECT NEGATIVE SIGN NET INTEREST MARGIN 0 HYPOTHESIS OVERHEAD COSTS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS PRODUCTION FUNCTION PRODUCTIVITY PRODUCTIVITY GROWTH PROFIT RATE PROFITABILITY PROMOTING GROWTH PUBLIC INFRASTRUCTURE REAL GDP REAL INTEREST RATE REAL INTEREST RATES RETAINED EARNINGS RISK FACTORS RISK SHARING SAVINGS SERIAL CORRELATION SIGNIFICANT IMPACT STATE BANKS TRADE LIBERALIZATION TRANSITION ECONOMIES
spellingShingle	ACCOUNTING ACTUAL COST ALLOCATIVE EFFICIENCY AUDITING BANK ASSETS BANK OF KOREA BANKING SECTOR BANKING SERVICES BORROWING CAPACITY BUILDING CAPITAL ACCUMULATION CAPITAL FLIGHT CAPITAL INVESTMENT CAPITAL MOBILITY COMPETITIVENESS CONSTANT RETURNS TO SCALE CONSUMERS COST OF CAPITAL COUNTRY LEVEL DEBT DEPENDENT VARIABLE DESCRIPTIVE STATISTICS DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPMENT ECONOMICS DOMESTIC CREDIT DYNAMIC PANEL EARNING ASSETS ECONOMETRICS ECONOMIC GROWTH ECONOMIC LITERATURE ECONOMIC STATISTICS ECONOMIC STUDIES EMPIRICAL ANALYSIS EMPIRICAL EVIDENCE EMPIRICAL MODEL EMPIRICAL RESULTS EMPIRICAL SECTION EMPIRICAL STUDIES EMPLOYMENT EMPLOYMENT EQUATIONS ENTREPRENEURSHIP EQUATIONS ERROR TERM ERROR TERMS ESTIMATED COEFFICIENTS ESTIMATION METHOD ESTIMATION RESULTS EXPECTED RETURNS EXPECTED VALUE EXPLANATORY VARIABLES FINANCIAL DEPTH FINANCIAL DEVELOPMENT FINANCIAL INSTITUTIONS FINANCIAL INTEGRATION FINANCIAL INTERMEDIARIES FINANCIAL INTERMEDIARY DEVELOPMENT FINANCIAL INTERMEDIATION FINANCIAL LIBERALIZATION FINANCIAL MARKETS FINANCIAL REGULATION FINANCIAL SECTOR FINANCIAL SERVICES FOREIGN BANKS FOREIGN ENTRY FUNCTIONAL FORM GDP GDP PER CAPITA GLOBALIZATION GROWTH IMPACT GROWTH LITERATURE GROWTH MODEL GROWTH MODELS GROWTH RATE GROWTH REGRESSIONS HIGH INFLATION HUMAN CAPITAL IMPROVING PRODUCTIVITY INDEPENDENT VARIABLES INFLATION INFLATION RATE INTEREST INCOME INTEREST RATE INTEREST RATES INTERNATIONAL COMPETITION INVESTMENT RATE LAGGED LEVELS LAWS LIBERALIZATION OF FINANCIAL MARKETS LIQUIDITY LONG-RUN GROWTH LOW INTEREST RATES LOWERING BARRIERS MACROECONOMIC INSTABILITY MACROECONOMIC STABILITY MARKET FAILURES MONETARY ECONOMICS NAFTA NEGATIVE EFFECT NEGATIVE SIGN NET INTEREST MARGIN 0 HYPOTHESIS OVERHEAD COSTS POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS PRODUCTION FUNCTION PRODUCTIVITY PRODUCTIVITY GROWTH PROFIT RATE PROFITABILITY PROMOTING GROWTH PUBLIC INFRASTRUCTURE REAL GDP REAL INTEREST RATE REAL INTEREST RATES RETAINED EARNINGS RISK FACTORS RISK SHARING SAVINGS SERIAL CORRELATION SIGNIFICANT IMPACT STATE BANKS TRADE LIBERALIZATION TRANSITION ECONOMIES Bayraktar, Nihal Wang, Yan Banking Sector Openness and Economic Growth
relation	Policy Research Working Paper; No. 4019
description	Banking sector openness may directly affect growth by improving the access to financial services and indirectly by improving the efficiency of financial intermediaries, both of which reduce the cost of financing, and in turn, stimulate capital accumulation and economic growth. The objective of the paper is to empirically reinvestigate these direct and indirect links using a more advanced econometric technique (GMM dynamic panel estimators). An illustrative model is presented to link financial market development with investment. The empirical results confirm the presence of direct and indirect links, and thus provide support for countries planning to open their banking sector for international competition.
format	Publications & Research :: Policy Research Working Paper
author	Bayraktar, Nihal Wang, Yan
author_facet	Bayraktar, Nihal Wang, Yan
author_sort	Bayraktar, Nihal
title	Banking Sector Openness and Economic Growth
title_short	Banking Sector Openness and Economic Growth
title_full	Banking Sector Openness and Economic Growth
title_fullStr	Banking Sector Openness and Economic Growth
title_full_unstemmed	Banking Sector Openness and Economic Growth
title_sort	banking sector openness and economic growth
publisher	World Bank, Washington, DC
publishDate	2012
url	http://documents.worldbank.org/curated/en/2006/10/7095002/banking-sector-openness-economic-growth http://hdl.handle.net/10986/9273
_version_	1764406546134990848

Banking Sector Openness and Economic Growth

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