This paper empirically examines whether globalization affects the level, volatility and structure of financial development as well as the competition and credit composition of the banking sector. Using dynamic panel estimation techniques, we find, in a sample of advanced and developing countries, that both trade and financial openness promote financial development, raise financial volatility, and result in a more market-based financial system, the effects that moderate with increased openness. It is also found that both trade and financial openness lead to a more competitive, less concentrated banking industry and a greater share of household credit relative to enterprise credit, the effects that dampen with increased openness.
Financial developmentfinancial volatilityfinancial and banking structurecredit compositionglobalization
Shu-Chin Lin、Yi-Chen Wu
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Department of Economics, SungKyunKwan University, Seoul, Korea
Department of International Business, Soochow University, Taipei, Taiwan (R.O.C.)
NETL
NSTL
Taylor & Francis
