Financial Development and Geographic Isolation: Global Evidence

African Governance and Development Institute WP/16/014

19 Pages Posted: 28 Jun 2016

See all articles by Oasis Kodila-Tedika

Oasis Kodila-Tedika

University of Kinshasa - Department of Economics

Simplice Asongu

African Governance and Development Institute

Matthias M. Cinyabuguma

University of Maryland, Baltimore County (UMBC) - Department of Economics

Date Written: March 25, 2016

Abstract

Using cross-country differences in the degree of isolation before the advent of technologies in sea and air transportation, we assess the relationship between geographic isolation and financial development across the globe. We find that pre-historic geographical isolation has been beneficial to development because it has contributed to contemporary cross-country differences in financial development. The relationship is robust to alternative samples, different estimation techniques, outliers and varying conditioning information sets.

Keywords: financial development; isolation; agglomeration; globalization

JEL Classification: F15; G15; N7; O16; O50

Suggested Citation

Kodila-Tedika, Oasis and Asongu, Simplice and Cinyabuguma, Matthias M., Financial Development and Geographic Isolation: Global Evidence (March 25, 2016). African Governance and Development Institute WP/16/014. Available at SSRN: https://ssrn.com/abstract=2800640 or http://dx.doi.org/10.2139/ssrn.2800640

Oasis Kodila-Tedika

University of Kinshasa - Department of Economics ( email )

Kinshasa
Democratic Republic of the Congo

Simplice Asongu (Contact Author)

African Governance and Development Institute ( email )

P.O. Box 8413
Yaoundé, 8413
Cameroon

Matthias M. Cinyabuguma

University of Maryland, Baltimore County (UMBC) - Department of Economics ( email )

1000 Hilltop Circle
Baltimore, MD 21250
United States

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