Financial Openness and Trade (Real) Openness: Should We Open Up Both Markets?

• 발행기관: 세종대학교 경제통합연구소
• 저자명: Chew Keong Wai Tuck Cheong Tang Siew Voon Soon
• 간행물 정보: 『Journal of Economic Integration』제39권 제2호, 483~507쪽, 전체 25쪽
• 주제분류: 경제경영 > 경제학
• 파일형태: PDF
• 발행일자: 2024.06.01

국문 초록

This study examines the 'interdependence' between financial openness and trade (real) openness, as well as the macroeconomic determinants of such relationship from a general equilibrium perspective (viz. the balance of payments constraint). The macroeconomics factors are national income, exchange rate, and interest rate. The data cover 124 countries over a period spanning between 1970 and 2019. The 'interdependence' between financial and trade openness is captured by a positive Pearson correlation in most of the countries (i.e. between 60% and 79% of the countries). However, a more precise measure of a bidirectional causality between both openness exists in only 35% (44 countries) of 124 countries. The empirical results show that exchange rate explains negatively the estimated correlation coefficients between financial and trade openness, as well as for low income countries. While, the interest rate increases the likelihood of their bidirectional causality results. This study provides policy insights related to both the financial and real markets.

목차

I. Introduction

II. Conceptual Framework, Data, and Methods of Analysis

III. Empirical Results

IV. Concluding Remarks

References

키워드

causality financial openness interdependence real sector trade openness