International Financial Integration and Economic Growth

39 Pages Posted: 16 Jul 2002

See all articles by Hali J. Edison

Hali J. Edison

International Monetary Fund (IMF) - Research Department

Ross Levine

University of California, Berkeley - Haas School of Business; National Bureau of Economic Research (NBER)

Luca A. Ricci

International Monetary Fund (IMF) - Research Department

Torsten Sløk

Deutsche Bank, New York

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Abstract

This paper uses new data and new econometric techniques to investigate the impact of international financial integration on economic growth and also to assess whether this relationship depends on the level of economic development, financial development, legal system development, government corruption, and macroeconomic policies. Using a wide array of measures of international financial integration on 57 countries and an assortment of statistical methodologies, we are unable to reject the null hypothesis that international financial integration does not accelerate economic growth even when controlling for particular economic, financial, institutional, and policy characteristics.

Keywords: International Finance, Economic Growth, Foreign Direct Investment, Portfolio Investment, Developing Countries

JEL Classification: F3, O4, O16

Suggested Citation

Edison, Hali J. and Levine, Ross Eric and Ricci, Luca Antonio and Sløk, Torsten Mikkel, International Financial Integration and Economic Growth. Journal of International Money and Finance, Vol. 21, November 2002. Available at SSRN: https://ssrn.com/abstract=314925 or http://dx.doi.org/10.2139/ssrn.314925

Hali J. Edison (Contact Author)

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-6946 (Phone)
202-589-6946 (Fax)

Ross Eric Levine

University of California, Berkeley - Haas School of Business ( email )

545 Student Services Building, #1900
2220 Piedmont Avenue
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Luca Antonio Ricci

International Monetary Fund (IMF) - Research Department ( email )

700 19th Street NW
Washington, DC 20431
United States
202-623-6007 (Phone)
202-623-4072 (Fax)

Torsten Mikkel Sløk

Deutsche Bank, New York ( email )

60 Wall Street
Mail Stop: NYC60-1815
New York, NY 10005
United States

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