Experimental study of the effects of financial liberalization on growth and developed a group of developing countries (with an emphasis on Iran)

Subject Areas : Financial Economics

رویا  Seifi por ¹ (استادیار دانشگاه آزاد اسلامی واحد تهران مرکزی)

Received: 2015-05-11 Accepted : 2015-05-11 Published : 2012-09-22

Keywords:

Abstract :

In the past, theories of economic growth were believed thatreal resources such as land and capital growth were the main constraints and would be ignored the role of financial markets. But new theories are emphasized on the importance of freedom of the financial sector and the importance of financial sector in the development process. Proponents of market economy are believed that flourishing competitive markets, privatization of public enterprises, free trade, attracting foreign capital and elimination government waste regulations enhance efficiency and growth will be provided. So the aim of the present study is analysis the effects of financial liberalization on economic growth. For this purpose, data 37 countries has been used that include 23 countries with low and middle incomes and 14 high-income countries in the period 2008-1980. The results are showed that long-term effect of capital market liberalization on growth in low and middle income countries is negative and in high-income countries is positive. However, the effect of capital inflows on the high and low and middle income countries is positive.

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