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Further evidence on the link between finance and cyclical fluctuations
Joint Authors
Source
Economic Research Forum : Working Paper Series
Issue
Vol. 2001, Issue 101-140 (31 Dec. 2001)23 p.
Publisher
Economic Research Forum for the Arab Countries Iran and Turkey
Publication Date
2001-12-31
Country of Publication
Egypt
No. of Pages
23
Main Subjects
Abstract EN
This paper explores the possibility that financial market development mitigates cyclical fluctuations in several developing countries.
The paper uses the GARCH approach to account for the time-varying behavior of macroeconomic volatility, and distinguishes between overall and sectoral macroeconomic volatility.
Results from co-integration and error-correction models suggest that financial market development (alternatively measured) does exert a robust long- term dampening effect on macroeconomic volatility.
In contrast, short-term effects of financial development on cyclical fluctuations are generally tenuous, or non-existent.
These findings imply that financial reforms can contribute to macroeconomic stability, but only if these reforms persist over a prolonged period of time.
The results also suggest that financial reforms impact economic sectors differently across the countries examined.
American Psychological Association (APA)
Darrat, Ali F.& Hajj, Mahmud. 2001. Further evidence on the link between finance and cyclical fluctuations. Economic Research Forum : Working Paper Series،Vol. 2001, no. 101-140.
https://search.emarefa.net/detail/BIM-968816
Modern Language Association (MLA)
Darrat, Ali F.& Hajj, Mahmud. Further evidence on the link between finance and cyclical fluctuations. Economic Research Forum : Working Paper Series No. 101-140 (Dec. 2001).
https://search.emarefa.net/detail/BIM-968816
American Medical Association (AMA)
Darrat, Ali F.& Hajj, Mahmud. Further evidence on the link between finance and cyclical fluctuations. Economic Research Forum : Working Paper Series. 2001. Vol. 2001, no. 101-140.
https://search.emarefa.net/detail/BIM-968816
Data Type
Journal Articles
Language
English
Notes
Includes appendices.
Record ID
BIM-968816