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Economic Growth and Financial Development pp 135–153Cite as

Financial Liberalization, Capital Movements, and Economic Growth in Asia: A Panel Structural VAR Approach

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Abstract

There has been intensive research in the literature of macroeconomics examining the nexus between finance, capital movements, and economic growth to explore the impact of each variable on other variables in the system. One might claim that these researches, needless to say, are seminal and have some considerable outputs. The relevant literature, however, conducts mostly the estimations from macro-econometric models in which structural impulse responses are not monitored. Therefore, this chapter aims at launching panel structural VAR (panel SVAR) model estimations by loading relevant matrices for the decomposition of the shocks into common and composite shocks through recursive impulse responses by a triangular matrix. The contemporaneous impact of a shock in a panel variable on other panel variables are, hence, straightforward and transparent in panel SVAR. The models of panel SVAR of this chapter employs 24 Asian countries for the period 1994–2017. The 576 observations from three different panel SVAR model predictions reveal in general that panel Asian GDP responds positively to the shocks in panel Asian financial development index, financial markets access index, financial markets efficiency index, and gross fixed capital formation.

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Authors and Affiliations

  1. Erciyes University, Faculty of Economics and Administrative Sciences, Kayseri, Turkey

    Faik Bilgili & Emrah Koçak

  2. Yozgat Bozok University, Faculty of Economics and Administrative Sciences, Yozgat, Turkey

    İbrahim Doğan

  3. Erciyes University, Justice Vocational College, Department of Law, Kayseri, Turkey

    Sevda Kuşkaya

Authors
  1. Faik Bilgili
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  2. İbrahim Doğan
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  3. Emrah Koçak
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  4. Sevda Kuşkaya
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Correspondence to Faik Bilgili .

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Editors and Affiliations

  1. School of Management and Economics, Beijing Institute of Technology, Beijing, China

    Muhammad Shahbaz

  2. Leeds Business School, Leeds Beckett University, Leeds, UK

    Alaa Soliman

  3. Nottingham University Business School, University of Nottingham, Nottingham, UK

    Subhan Ullah

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Bilgili, F., Doğan, İ., Koçak, E., Kuşkaya, S. (2021). Financial Liberalization, Capital Movements, and Economic Growth in Asia: A Panel Structural VAR Approach. In: Shahbaz, M., Soliman, A., Ullah, S. (eds) Economic Growth and Financial Development. Springer, Cham. https://doi.org/10.1007/978-3-030-79003-5_8

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