Short-Run Pain, Long-Run Gain: The Effects of Financial Liberalization / Graciela Kaminsky, Sergio Schmukler.

Format:

Book

Author/Creator:

Kaminsky, Graciela.

Contributor:

National Bureau of Economic Research.

Schmukler, Sergio.

Series:

Working Paper Series (National Bureau of Economic Research) no. w9787.

NBER working paper series no. w9787

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Short-Run Pain, Long-Run Gain

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2003.

Summary:

We examine the short- and long-run effects of financial liberalization on capital markets. To do so, we construct a new comprehensive chronology of financial liberalization in 28 mature and emerging economies since 1973. We also construct an algorithm to identify booms and busts in stock market prices. Our results indicate that financial liberalization is followed by more pronounced boom-bust cycles in the short run. However, financial liberalization leads to more stable markets in the long run. Finally, we analyze the sequencing of liberalization and institutional reforms to understand the contrasting short- and long-run effects of liberalization.

Notes:

Print version record

June 2003.