Skip to main content
SpringerLink
Log in

Financial Liberalization, the Finance–Growth Nexus, Financial Crises and Policy Implications

  • Chapter
  • First Online:
Financial Liberalisation

Part of the book series: International Papers in Political Economy ((IPPE))

Abstract

The purpose of this chapter is to investigate the growth–finance nexus with reference to the ‘financial liberalization’ thesis. This thesis can be succinctly summarized as amounting to freeing financial markets from any intervention and letting market forces determine the size and allocation of credit. The history of banking, however, since the policymakers in both developing (emerging) and developed countries adopted the financial liberalization thesis tells a rather different and sad story. Ever since the adoption of the essentials of the financial liberalization thesis, banking crises have been unusually frequent and severe. In this contribution we discuss the financial liberalization aspect of crises, emphasizing two examples that led to crises: the Southeast Asian crisis and the 2007/2008 international financial crisis that led to the ‘Great Recession’. We then discuss economic policy implications, along with relevant economic policy proposals that could support financial stability and avoid future financial crises.

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Log in via an institution
Chapter
USD 29.95
Price excludes VAT (USA)
  • Available as PDF
  • Read on any device
  • Instant download
  • Own it forever
eBook
USD 119.00
Price excludes VAT (USA)
  • Available as EPUB and PDF
  • Read on any device
  • Instant download
  • Own it forever
Softcover Book
USD 159.99
Price excludes VAT (USA)
  • Compact, lightweight edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info
Hardcover Book
USD 159.99
Price excludes VAT (USA)
  • Durable hardcover edition
  • Dispatched in 3 to 5 business days
  • Free shipping worldwide - see info

Tax calculation will be finalised at checkout

Purchases are for personal use only

Institutional subscriptions

Notes

  1. 1.

    See Sawyer (2014), for example, on the origins and usage of the term financialization.

  2. 2.

    The relevant details and numbers referred to in the text are available at: http://www.investopedia.com/terms/f/financialization.asp. See, also, Greenspan (2010).

  3. 3.

    Other contributors have argued that financial development and financial structure cause technological innovation and development. Yartley (2006), for example, presents panel regression results for a group of developed and developing countries to explain cross-country diffusion of ‘innovation and communication technologies’ to make the point.

  4. 4.

    It should be noted that there has been explicit opposition to targeting asset markets and asset prices on two arguments. One argument suggests that trying to stabilize asset prices is problematic: it is uncertain whether a given change in asset values results from fundamental or non-fundamental factors or both. Proactive monetary policy would require the authorities to outperform market participants. Another argument is that the size of the change in the rate of interest to prick a bubble may be substantial and harmful to the real economy. Both Bernanke (2002) and Greenspan (2002a, b) argued against targeting asset prices with their views based on these two arguments. Neither of these arguments is relevant in terms of our suggestion to target net wealth as it is clear from the arguments as in the text. Asset price bubbles can be very harmful, a very good recent example is the international financial crisis of 2007/2008, and appropriate policies are very relevant and urgently required.

  5. 5.

    Goodhart and Persaud (2008) propose a ‘counter-cyclical capital standards’ to tackle asset price bubbles. Capital standards would rise in booms to avoid excessive asset price increases and overexpansion of financial intermediary balance sheets; and would fall in the downswing to avoid excessive fall in credit provision. Another relevant proposal is by Palley (2013) who argues for an ‘asset-based reserve requirements’, which, it is suggested, “can enhance counter-cyclical monetary policy” (p. 165). Under such a system financial intermediaries would hold reserves against their assets and this should be applied to all financial intermediaries. Such a system would work through the interest rate channel but changes in interest rates would be targeting a particular asset class with changing the rate of interest for that particular class.

References

  • Abiad, A., Detragiache, E., & Tressel, T. (2008). A New Data Base of Financial Reforms. Working Paper, No. 08/266. Washington, DC: International Monetary Fund.

    Google Scholar 

  • Agur, H., & Demertzis, M. (2015). Will Macroprudential Policy Counteract Monetary Policy’s Effects on Financial Stability? Working Paper, WP/15/283. Washington, DC: International Monetary Fund.

    Google Scholar 

  • Arestis, P. (2004). Washington Consensus and Financial Liberalization. Journal of Post Keynesian Economics, 26(2), 251–271.

    Google Scholar 

  • Arestis, P. (2005). Financial Liberalization and the Relationship between Finance and Growth. In P. Arestis & M. Sawyer (Eds.), Handbook of Alternative Monetary Economics. Cheltenham: Edward Elgar.

    Google Scholar 

  • Arestis, P. (2009). New Consensus Macroeconomics and Keynesian Critique. In E. Hein, T. Nichol, & E. Stockhammer (Eds.), Macroeconomic Policies on Shaky Foundations—Whither Mainstream Economics? Marburg, Germany: Metropolis–Vela.

    Google Scholar 

  • Arestis, P. (2011). Keynesian Economics and the New Consensus in Macroeconomics. In E. Hein & E. Stockhammer (Eds.), A Modern Guide to Keynesian Macroeconomics and Economic Policies. Cheltenham: Edward Elgar.

    Google Scholar 

  • Arestis, P. (2012). Fiscal Policy: A Strong Macroeconomic Role. Review of Keynesian Economics, 1(1), 93–108.

    Article  Google Scholar 

  • Arestis, P. (2015). Coordination of Fiscal with Monetary and Financial Stability Policies Can Better Cure Unemployment. Review of Keynesian Economics, 3(2), 233–247.

    Article  Google Scholar 

  • Arestis, P. (2016a). Main and Contributory Causes of the Recent Financial Crisis and Economic Policy Implications. In P. Arestis & M. Sawyer (Eds.), Emerging Economies During and After the Great Recession, Annual Edition of International Papers in Political Economy. Houndmills, Basingstoke: Palgrave Macmillan.

    Chapter  Google Scholar 

  • Arestis, P. (2016b). Financial Liberalization, Crises and Policy Implications. In F. Elgin (Ed.), Financial Development, Economic Crises and Emerging Market Economies. London: Routledge, Taylor and Francis Group.

    Google Scholar 

  • Arestis, P., & Caner, A. (2005). Financial Liberalization and Poverty: Channels of Influence. In P. Arestis & M. Sawyer (Eds.), Financial Liberalization: Beyond Orthodox Concerns (pp. 90–128). Houndmills, Basingstoke: Palgrave Macmillan.

    Chapter  Google Scholar 

  • Arestis, P., & Caner, A. (2010). Capital Account Liberalization and Poverty: How Close is the Link? (with A. Caner). Cambridge Journal of Economics, 34(2), 295–323.

    Google Scholar 

  • Arestis, P., & Demetriades, P. O. (1996). Finance and Growth: Institutional Considerations and Causality. Presented at the Royal Economic Society Annual Conference, Swansea University, 1–4 April.

    Google Scholar 

  • Arestis, P., & Demetriades, P. O. (1997). Financial Development and Economic Growth: Assessing the Evidence. Economic Journal, 107(442), 783–799.

    Article  Google Scholar 

  • Arestis, P., & Demetriades, P. O. (1998). Financial Liberalization: Myth or Reality?. In P. Arestis (Ed.), Method, Theory and Policy in Keynes: Essays in Honour of Paul Davidson (Vol. 3). Cheltenham: Edward Elgar (Chapter 11).

    Google Scholar 

  • Arestis, P., & Glickman, M. (2002). Financial Crisis in Southeast Asia: Dispelling Illusion the Minskyan Way. Cambridge Journal of Economics, 26(2), 237–260. Reprinted in R. E. Allen (Ed.), The International Library of Writings on the New Global Economy: The Political Economy of Financial Crises. Cheltenham: Edward Elgar (2004).

    Google Scholar 

  • Arestis, P., & Karakitsos, E. (2009). What Role for Central Banks in View of the Current Crisis?. Policy Note 2009/2. Levy Economics Institute of Bard College, Annandale-on-Hudson, New York (March).

    Google Scholar 

  • Arestis, P., & Sawyer, M. (2005). Financial Liberalization and the Finance-Growth Nexus: What Have we Learned? In P. Arestis & M. Sawyer (Eds.), Financial Liberalization: Beyond Orthodox Concerns (pp. 1–42). Houndmills, Basingstoke: Palgrave Macmillan.

    Chapter  Google Scholar 

  • Arestis, P., & Stein, H. (2005). An Institutional Perspective to Finance and Development as an Alternative to Financial liberalization. International Review of Applied Economics, 19(4), 381–398.

    Article  Google Scholar 

  • Arestis, P., Demetriades, P. O., & Fattouh, B. (2001a). Financial Liberalization and the Globalization of Financial Services: Two Lessons from the East Asian Experience. In S. Lahiri (Ed.), Regionalism and Globalisation: Theory and Practice. London: Routledge, Taylor and Francis Group.

    Google Scholar 

  • Arestis, P., Demetriades, P. O., & Luintel, K. (2001b). Financial Development and Economic Growth: The Role of Stock Markets. Journal of Money, Credit and Banking, 33(1), 16–41.

    Article  Google Scholar 

  • Arestis, P., Demetriades, P. O., & Fattouh, B. (2003). Financial Policies and the Aggregate Productivity of the Capital Stock. Eastern Economic Journal, 29(2), 217–242.

    Google Scholar 

  • Arestis, P., Chortareas, G., & Magkonis, G. (2015). The Financial Development and Growth Nexus: A Meta-Analysis. Journal of Economic Surveys, 29(3), 549–565.

    Article  Google Scholar 

  • Bagehot, W. (1873). Lombard Street: A Description of the Money Market. London: John Murray.

    Google Scholar 

  • Bank for International Settlements (BIS). (2011). Basel III: A Global Regulatory Framework for More Resilient Banks and Banking Systems, December 2010 (Revised June 2011). Available at: http://www.bis.org/publ/bcbs189.pdf.

  • Bean, C., Panstian, M., Penalver, A., & Taylor, T. (2010). Monetary Policy After the Fall. Federal Reserve Bank of Kansas City Annual Conference, 28 August. Jackson Hole: Wyoming.

    Google Scholar 

  • Beck, T. (2012). The Role of Finance in Economic Development: Benefits, Risks, and Politics. In D. C. Mueller (Ed.), The Oxford Book of Capitalism. New York: Oxford University Press.

    Google Scholar 

  • Beck, T., Degryseb, H., & Kneer, C. (2013). Is More Finance Better? Disentangling Intermediation and Size Effects of Financial Systems. Journal of Financial Stability, 10, 50–64.

    Article  Google Scholar 

  • Bernanke, B. S. (2002). Asset Price Bubbles and Monetary Policy. Remarks Before the New York Chapter of the National Association for Business Economics, New York, 15 October.

    Google Scholar 

  • Blinder, A. S. (2010). Commentary: Rethinking Moneatry Policy in Light of the Crisis. Federal Reserve Bank of Kansas City Annual Economic Symposium, 28 August. Jackson Hole: Wyoming.

    Google Scholar 

  • Bordo, M. D., Eichengreen, B., Klingebiel, D., & Martinez-Perio, M. S. (2001). Is the Crisis Problem Going More Severe? Economic Policy, 32, 51–82.

    Google Scholar 

  • Calvo, G. A. (1988). Servicing the Public Debt: The Role of Expectations. American Economic Review, 78(4), 647–661.

    Google Scholar 

  • Caprio Jr., G., Atiyas, I., & Hanson, J. A. (Eds.) (1994). Financial Reform: Theory and Experience. Cambridge: Cambridge University Press.

    Google Scholar 

  • Cecchetti, S. G., & Kharroubi, E. (2012). Reassessing the Impact of Finance on Growth. BIS Working Papers, No. 381.

    Google Scholar 

  • Cecchetti, S. G., & Kharroubi, E. (2015). Why Does Financial Sector Growth Crowds Out Real Economic Growth. BIS Working Papers, No. 490.

    Google Scholar 

  • Cho, Y.-J., & Khatkhate, D. (1989). Lessons of Financial Liberalization in Asia: A Comparative Study. World Bank Discussion Papers, No. 50.

    Google Scholar 

  • Creel, J., Hubert, P., & Labondance, F. (2014). Financial Stability and Economic Performance. Economic Modelling, 48, 25–40.

    Article  Google Scholar 

  • De Paula, L. F. (2011). Financial Liberalization and Economic Performance: Brazil at the Crossroads. London: Routledge, Taylor and Francis Group.

    Google Scholar 

  • Demetriades, P. O., & Luintel, K. B. (1996). Financial Restraints in the South Korean Miracle. Journal of Development Economics, 64(2), 459–479.

    Article  Google Scholar 

  • Edwards, S. (1989). On the Sequencing of Structural Reforms. Working Paper, No. 70, OECD Department of Economics and Statistics.

    Google Scholar 

  • Eichengreen, B. (2004). Capital Flows and Crises. Cambridge, MA: MIT Press.

    Google Scholar 

  • Eichengreen, B., & Arteta, C. (2002). Banking Crises in Emerging Countries: Presumption and Evidence. In M. I. Blejer & S. Marko (Eds.), Financial Policies in Emerging Markets (pp. 47–49). Cambridge, MA: MIT Press.

    Google Scholar 

  • Eichengreen, B., & Leblang, D. (2004). Capital Account Liberalization and Growth: Was Mr Mahathir Right?. NBER Working Paper Series No. 9427. Cambridge, MA: National Bureau of Economic Research.

    Google Scholar 

  • Epstein, G. A. (2005). Introduction: Financialization and the World Economy. In G. A. Epstein (Ed.), Financialization and the World Economy (pp. 3–16). Cheltenham: Edward Elgar.

    Google Scholar 

  • Favara, G. (2003). An Empirical Assessment of the Relationship Between Finance and Growth. IMF Working Paper, No. 03/123. Washington, DC: International Monetary Fund.

    Google Scholar 

  • FitzGerald, V. (2006). Models of Saving, Income and the Macroeconomics of Developing Countries in the Post-Keynesian Tradition. In P. Arestis, L. McCombie, & R. Vickerman (Eds.), Growth and Economic Development: Essays in Honour of AP Thirlwall (pp. 247–262). Cheltenham: Edward Elgar.

    Google Scholar 

  • Fry, M. J. (1995). Money, Interest and Banking in Economic Development. London: John Hopkins University Press.

    Google Scholar 

  • Furceri, D., & Loungani, P. (2016). Opening Up to Inequity. Finance and Development. International Monetary Fund, 53(1), 43–46.

    Google Scholar 

  • Galbraith, J. K. (2012). New Thinking and a Strategic Policy Agenda. OECD Forum, Paris, 21–23 May.

    Google Scholar 

  • Goldsmith, R. W. (1969). Financial Structure and Development. New Haven, CT: Yale University Press.

    Google Scholar 

  • Goodhart, C., & Persaud, A. (2008). A Proposal for How to Avoid the Next Crash. Financial Times, 31 January.

    Google Scholar 

  • Gould, B. (2013). Myths, Politicians & Money: The Truth Behind Free Markets. Houndmills, Basingstoke: Palgrave Macmillan.

    Book  Google Scholar 

  • Grabel, I. (1995). Speculation-Led Economic Development: A Post-Keynesian Interpretation of Financial Liberalization Programs. International Review of Applied Economics, 9(2), 127–149.

    Article  Google Scholar 

  • Greenspan, A. (2002a). Economic Volatility. Remarks at the Federal Reserve Bank of Kansas City Annual Economic Symposium, 30 August. Jackson Hole: Wyoming.

    Google Scholar 

  • Greenspan, A. (2002b). Issues for Monetary Policy. Remarks at the Economic Club of New York, New York City, 19 December.

    Google Scholar 

  • Greenspan, A. (2010). The Crisis. Brookings Papers on Economic Activity, Spring. Available at: http://www.brookings.edu/~/media/Files/Programs/ES/BPEA/2010_spring_bpea_papers/spring2010greenspan.pdf.

  • Haldane, A. G. (2010). The $100 Billion Question. Speech at the Institute of Regulation & Risk, North Asia (IRRNA), Hong Kong, 30 March 2010. Available at: http://www.bankofengland.co.uk/publications/speeches/2010/speech433.pdf.

  • Honohan, P., & Klingebiel, D. (2000). Controlling Fiscal Costs of Banking Crises. In Mimeo. Washington, DC: World Bank.

    Google Scholar 

  • IMF. (2010a). A Fair and Substantial Contribution by the Financial Sector. Interim Report for the Meeting of the G20 Ministers, 16 April 2010. Washington, DC: International Monetary Fund.

    Google Scholar 

  • IMF. (2010b). Central Banking Lessons from the Crisis. Monetary and Capital Markets Department, 27 May 2010. Washington, DC: International Monetary Fund.

    Google Scholar 

  • IMF. (2010c). Global Financial Stability Report: Sovereigns, Funding, and Systemic Liquidity, October 2010. Washington, DC: International Monetary Fund. Available at: http://www.imf.org/external/pubs/ft/gfsr/2010/02/index.htm.

  • IMF. (2012). Global Financial Stability Report: The Quest for Lasting Stability, April 2012. Washington, DC: International Monetary Fund. Available at: https://www.imf.org/external/pubs/ft/gfsr/2012/01/pdf/text.pdf.

  • Jarsulic, M. (2010). Anatomy of a Financial Crisis: A Real Estate Bubble, Runaway Credit Markets, and Regulatory Failure. Houndmills, Basingstoke: Palgrave Macmillan.

    Book  Google Scholar 

  • Kaminsky, G. L., & Reinhart, C. M. (1999). The Twin Crises: The Causes of Banking and Balance of Payments Problems. American Economic Review, 89(3), 473–500.

    Article  Google Scholar 

  • Keynes, J. M. (1930). Economic Possibilities for Our Grandchildren. In J. M. Keynes (Ed.), Essays In Persuasion (pp. 358–373). New York: W.W. Norton.

    Google Scholar 

  • Keynes, J. M. (1936). The General Theory of Employment, Interest and Money. London: Macmillan.

    Google Scholar 

  • King, R. G., & Levine, R. (1993a). Finance and Growth: Schumpeter Might Be Right. Quarterly Journal of Economics, VIII, 717–737.

    Article  Google Scholar 

  • King, R. G., & Levine, R. (1993b). Finance, Entrepreneurship, and Growth: Theory and Evidence. Journal of Monetary Economics, 32(3), 513–542.

    Article  Google Scholar 

  • Laeven, L., & Valencia, F. (2012). Systemic Banking Crises Database: An Update. IMF Working Papers, WP/12/163. Washington, DC: International Monetary Fund. Available at: http://www.imf.org/external/pubs/ft/wp/2012/wp12163.pdf.

  • Laeven, L., & Valencia, F. (2013). Systemic Banking Crises Database. IMF Economic Review, 61(2), 225–270.

    Article  Google Scholar 

  • Lagarde, C. (2014). Economic Inclusion and Financial Integrity. Speech Given at the Conference on Inclusive Capitalism, London, 27 May. Available at: http://www.inc-cap.com/IC_ESSAY_Book_Introduction_Keynotes.pdf.

  • Lal, D. (1987). The Political Economy of Economic Liberalization. World Bank Economic Review, 1(2), 273–299.

    Article  Google Scholar 

  • Lawrence, M. (2014). Definancialization: A Democratic Reformation of Finance. London: Institute for Public Policy Research.

    Google Scholar 

  • Levine, R. (2002). Bank-Based or Market-Based Financial Systems: Which is Better? Journal of Financial Intermediation, 11(4), 398–428.

    Article  Google Scholar 

  • Levine, R. (2005). Finance and Growth: Theory and Evidence. In A. Philippe & N. Steven (Eds.), Handbook of Economic Growth (pp. 865–934). Amsterdam: Elsevier (Chapter 12).

    Google Scholar 

  • Lucas, R. E. (1988). On the Mechanics of Economic Development. Journal of Monetary Economics, 22(1), 3–42.

    Article  Google Scholar 

  • Majerbi, B., & Rachdi, H. (2014). Systemic Banking Crises, Financial Liberalization and Governance. Multinational Finance Journal, 18(3/4), 281–336.

    Article  Google Scholar 

  • McKinnon, R. I. (1973). Money and Capital in Economic Development. Washington, DC: Brookings Institution.

    Google Scholar 

  • McKinnon, R. I. (1988). Financial Liberalization in Retrospect: Interest Rate Policies in LDCs. In G. Ranis & T. P. Schultz (Eds.), The State of Development Economics. Oxford: Basil Blackwell.

    Google Scholar 

  • McKinnon, R. I. (1989). Financial Liberalization and Economic Development: A Reassessment of Interest-rate Policies in Asia and Latin America. Oxford Review of Economic Policy, 5(4), 29–54.

    Article  Google Scholar 

  • McKinnon, R. I. (1991). The Order of Economic Liberalization: Financial Control in the Transition to a Market Economy. Baltimore: John Hopkins University Press.

    Google Scholar 

  • Miller, M. H. (1998). Financial Markets and Economic Growth. Journal of Applied Corporate Finance, 11(1), 8–14.

    Article  Google Scholar 

  • Minsky, H. P. (1982). Can “It” Happen Again: Essays on Instability and Finance. Armonk, NY: M.E. Sharpe.

    Google Scholar 

  • Minsky, H. P. (1986). Stabilizing an Unstable Economy. New Haven, CT: Yale University Press.

    Google Scholar 

  • Naceur, B. N., & Zhang, R. (2016). Financial Development, Inequality and Poverty: Some International Evidence. IMF Working Paper WP/16/32. Washington, DC: International Monetary Fund.

    Google Scholar 

  • OECD. (2008). Growing Unequal? Income Distribution and Poverty in OECD Countries. Paris, October.

    Google Scholar 

  • Pagano, M. (1993). Financial Markets and Growth: An Overview. European Economic Review, 37(2–3), 613–622.

    Article  Google Scholar 

  • Palley, T. I. (2012). From Financial Crisis to Stagnation: The Destruction of Shared Prosperity and the Role of Economics. Cambridge: Cambridge University Press.

    Book  Google Scholar 

  • Palley, T. I. (2013). Financialization: The Economies of Finance Capital Domination. Houndmills, Basingstoke: Palgrave Macmillan.

    Book  Google Scholar 

  • Patrick, H. (1966). Financial Development and Economic Growth in Underdeveloped Countries. Economic Development and Cultural Change, 14(2), 174–189.

    Article  Google Scholar 

  • Philippon, T., & Reshef, A. (2009). Wages and Human Capital in the U.S. Financial Industry: 1909–2006. NBER Working Paper No. 14644. Washington, DC: National Bureau of Economics Research.

    Google Scholar 

  • Rajan, R. G. (2010). Fault Lines: How Hidden fractures Still Threaten the World Economy. Princeton, NJ: Princeton University Press.

    Google Scholar 

  • Reinhart, C. M. (2012). A Series of Unfortunate Events: Common Sequencing Patterns in Financial Crises. NBER Working Paper No. 17941. Washington, DC: National Bureau of Economics Research.

    Google Scholar 

  • Robinson, J. (1952). The Generalisation of the General Theory. In J. Robinson (Ed.), The Rate of Interest and Other Essays. London: Macmillan.

    Google Scholar 

  • Rousseau, P. L., & Wachtel, P. (2001). Inflation, Financial Development and Growth. In T. Negishi, R. Ramachandran, & K. Mino (Eds.), Economic Theory, Dynamics and Markets: Essays in Honour of Ryuzo Sato (pp. 309–324). Boston: Kluwer.

    Chapter  Google Scholar 

  • Rousseau, P. L., & Wachtel, P. (2011). What is Happening to the Impact of Financial Deepening on Economic Growth? Economic Inquiry, 49(1), 276–288.

    Article  Google Scholar 

  • Sachs, J. (1988). Conditionality, Debt Relief and the Developing Countries’ Debt Crisis. In J. Sachs (Ed.), Developing Country Debt and Economic Performance. Chicago: University of Chicago Press.

    Chapter  Google Scholar 

  • Sawyer, M. (2014). What is Financialization. International Journal of Political Economy, 42(4), 5–18.

    Article  Google Scholar 

  • Sawyer, M. (2015). Taxation of Financial Activities. Financialisation, Economy, Society and Sustainable Development (FESSUD) Working Paper. University of Leeds.

    Google Scholar 

  • Schumpeter, J. (1911). The Theory of Economic Development: An Inquiry into Profits, Capital, Credit, Interest and Business Cycle. Cambridge, MA: Harvard University Press.

    Google Scholar 

  • Shaw, E. S. (1973). Financial Deepening in Economic Development. New York: Oxford University Press.

    Google Scholar 

  • Smith, A. (1776). An Enquiry into the Nature and Causes of the Wealth of Nations. London: W. Stahan and T. Cadell.

    Google Scholar 

  • Stiglitz, J. E. (2004). Capital-Market Liberalization, Globalization, and the IMF. Oxford Review of Economic Policy, 20(1), 57–71.

    Article  Google Scholar 

  • Stiglitz, J. E., & Weiss, A. (1981). Credit Rationing in Markets with Imperfect Information. American Economic Review, 71(3), 393–410.

    Google Scholar 

  • Strauss-Khan, D. (2011). Global Challenges, Global Solutions. An Address at George Washington University. Washington, DC: International Monetary Fund, 4 April. Available at: http://www.imf.org/external/np/speeches/2011/040411.htm.

  • The Liikanen Report. (2012). High-Level Expert Group on Reforming the Structure of the EU Banking Sector. Final Report of the Committee Chaired by Erkki Liikanen, Brussels, October. Available at: http://ec.europa.eu/internal_market/bank/docs/high-level_expert_group/report_en.pdf.

  • Tobin, J. (1978). A Proposal for International Monetary Reform. Eastern Economic Journal, 4(3/4), 153–159.

    Google Scholar 

  • Van Der Zwan, N. (2014). Making Sense of Financialization. Socio-Economic Review, 12(1), 99–129.

    Article  Google Scholar 

  • Villanueva, D., & Mirakhor, A. (1990). Interest Rate Policies, Stabilisation and Bank Supervision in Developing Countries: Strategies for Financial Reform. IMF Working Papers, WP/90/8. Washington, DC: International Monetary Fund.

    Google Scholar 

  • Warman, F., & Thirlwall, T. (1994). Interest Rates, Saving, Investment and Growth in Mexico 1960–90: Tests of the Financial Liberalization Hypothesis. Journal of Development Studies, 30(3), 629–649.

    Article  Google Scholar 

  • Williams, J., & Nguyen, N. (2005). Financial Liberalization, Crisis, and Restructuring: A Comparative Study of Bank Performance and Bank Governance in Southeast Asia. Journal of Banking & Finance, 29(8/9), 2119–2154.

    Article  Google Scholar 

  • World Bank. (1989). World Development Report. Oxford: Oxford University Press.

    Google Scholar 

  • Yartley, C. A. (2006). Financial Development, the Structure of Capital Markets, and the Global Digital Divide. IMF Working Papers, WP/06/258. Washington, DC: International Monetary Fund.

    Google Scholar 

  • Zdzienicka, A., Chen, S., Kalan, F. Diaz, Laseen, S., & Svirydzenka, K. (2015). Effects of Monetary and Macroprudential Policies on Financial Conditions: Evidence from the United States. Working Paper, WP/15/288. Washington, DC: International Monetary Fund.

    Google Scholar 

Download references

Author information

Authors and Affiliations

  1. Department of Land Economy, University of Cambridge, 19, Silver Street, Cambridge, CB3 9EP, UK

    Philip Arestis

  2. University of the Basque Country, Bilbao, Spain

    Philip Arestis

Authors
  1. Philip Arestis
    View author publications

    You can also search for this author in PubMed Google Scholar

Editor information

Editors and Affiliations

  1. University of Cambridge, Cambridge, United Kingdom

    Philip Arestis

  2. University of Leeds, Leeds, United Kingdom

    Malcolm Sawyer

Rights and permissions

Reprints and permissions

Copyright information

© 2016 The Author(s)

About this chapter

Cite this chapter

Arestis, P. (2016). Financial Liberalization, the Finance–Growth Nexus, Financial Crises and Policy Implications. In: Arestis, P., Sawyer, M. (eds) Financial Liberalisation. International Papers in Political Economy. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-41219-1_1

Download citation

  • DOI: https://doi.org/10.1007/978-3-319-41219-1_1

  • Published:

  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-319-41218-4

  • Online ISBN: 978-3-319-41219-1

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

Publish with us

Policies and ethics

Search

Navigation