Effect of capital flows on financial stability in middle-income countries

IF 2 Q2 BUSINESS, FINANCE Journal of Financial Regulation and Compliance Pub Date : 2021-08-03 DOI:10.1108/jfrc-08-2020-0081
Kolawole Ebire, Saif Ullah, Bosede Ngozi Adeleye, M. I. Shah
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引用次数: 3

Abstract

Purpose This study aims to examine the effect of various forms of capital flows on financial stability in middle-income countries from 2010 to 2017 using the World Bank economy classifications of 121 economies. Design/methodology/approach Panel spatial correlation consistent approach was used in this study. Findings The findings provide convincing evidence that in middle-income countries, capital flows are positive and significant predictors of financial stability and that financial systems in advanced economies are more stable than those of emerging and developing countries. However, outward foreign direct investments are shown to have the largest potential for ensuring financial stability. Originality/value Globalization has fostered financial integration of nations, which is manifested in capital flows from lower-income countries to middle-income and upper-income countries and vice versa. These flows can lead to financial instability if not properly controlled. The authors show how the various forms of capital flows affect the financial stability in middle-income countries.
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资本流动对中等收入国家金融稳定的影响
目的本研究旨在利用世界银行对121个经济体的经济分类,考察2010-2017年各种形式的资本流动对中等收入国家金融稳定的影响。设计/方法/方法本研究采用了面板空间相关性一致性方法。研究结果提供了令人信服的证据,证明在中等收入国家,资本流动是金融稳定的积极和重要预测因素,发达经济体的金融体系比新兴国家和发展中国家的金融体系更稳定。然而,对外直接投资在确保金融稳定方面的潜力最大。独创性/价值全球化促进了各国的金融一体化,表现为资本从低收入国家流向中等收入和高收入国家,反之亦然。如果控制不当,这些流动可能导致金融不稳定。作者展示了各种形式的资本流动如何影响中等收入国家的金融稳定。
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来源期刊
CiteScore
2.60
自引率
11.10%
发文量
35
期刊介绍: Since its inception in 1992, the Journal of Financial Regulation and Compliance has provided an authoritative and scholarly platform for international research in financial regulation and compliance. The journal is at the intersection between academic research and the practice of financial regulation, with distinguished past authors including senior regulators, central bankers and even a Prime Minister. Financial crises, predatory practices, internationalization and integration, the increased use of technology and financial innovation are just some of the changes and issues that contemporary financial regulators are grappling with. These challenges and changes hold profound implications for regulation and compliance, ranging from macro-prudential to consumer protection policies. The journal seeks to illuminate these issues, is pluralistic in approach and invites scholarly papers using any appropriate methodology. Accordingly, the journal welcomes submissions from finance, law, economics and interdisciplinary perspectives. A broad spectrum of research styles, sources of information and topics (e.g. banking laws and regulations, stock market and cross border regulation, risk assessment and management, training and competence, competition law, case law, compliance and regulatory updates and guidelines) are appropriate. All submissions are double-blind refereed and judged on academic rigour, originality, quality of exposition and relevance to policy and practice. Once accepted, individual articles are typeset, proofed and published online as the Version of Record within an average of 32 days, so that articles can be downloaded and cited earlier.
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