|
EconStor >
United Nations University (UNU) >
World Institute for Development Economics Research (UNU-WIDER), United Nations University >
WIDER Discussion Papers, United Nations University (UNU) >
Please use this identifier to cite or link to this item:
http://hdl.handle.net/10419/52843
|
| | |
| Title: | | By how much does conflict reduce financial development?  |
| Authors: | | Addison, Tony Chowdhury, Abdur R. Murshed, S. Mansoob |
| Issue Date: | | 2002 |
| Series/Report no.: | | WIDER Discussion Papers // World Institute for Development Economics (UNU-WIDER) 2002/48 |
| Abstract: | | Financial development is vulnerable to social conflict. Conflict reduces the demand for domestic currency as a medium of exchange and a store of value. Conflict also leads to poor quality governance, including weak regulation of the financial system, thereby undermining the sustainability of financial institutions. Conflict therefore reduces the social return to financial liberalization and other financial-sector reforms. This paper presents a theoretical model integrating the effects of conflict and financial liberalization, and then tests the model on data for 79 countries. Using an explanatory variable that measures the intensity of conflict (from low to high) the results show that conflict significantly reduces financial development, and that this negative effect increases as conflict intensifies. The paper concludes that conflict reduction is essential if financial reform is to have its full benefit for development. |
| Subjects: | | financial development conflict financial regulation |
| JEL: | | O16 O23 |
| ISBN: | | 9291902195 |
| Document Type: | | Working Paper |
| Appears in Collections: | | WIDER Discussion Papers, United Nations University (UNU)
|
| |
| | |
Download bibliographical data as:
BibTeX
|
| |
Share on:http://hdl.handle.net/10419/52843
|
Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.
|