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The Impact of the Financial Crisis on Financial Integration, Growth and Investment

Published online by Cambridge University Press:  26 March 2020

Robert Inklaar ,
Juan Fernández de Guevara  and
Joaquín Maudos
Robert Inklaar
Affiliation:
University of Groningen
Juan Fernández de Guevara
Affiliation:
IVIE and University of Valencia
Joaquín Maudos
Affiliation:
IVIE and University of Valencia
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Abstract

Financial crises, and in particular those of the past few years, have severe consequences for the affected economies. In this paper we analyse the impact of financial development and European financial integration on growth and we find no reversal of the growth benefits of financial development and integration in recent years. This highlights the economic cost of regulatory changes that would reverse European financial integration. We also find that, following a financial crisis, investment declines more in countries with a greater degree of uncertainty aversion, which can be informative for evaluating post-crisis economic performance.

Keywords

Financial criseseconomic growthfinancial integrationuncertainty aversioninvestment
Type
Research Articles
Information
National Institute Economic Review , Volume 220 , April 2012 , pp. R29 - R35
Copyright
Copyright © 2012 National Institute of Economic and Social Research

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Footnotes

This research was undertaken as part of the INDICSER project, funded by the European Commission, Research Directorate General as part of the 7th Framework Programme, Theme 8: Socio-Economic Sciences and Humanities, Grant Agreement no. 244709. Fernández de Guevara and Maudos gratefully acknowledge the financial support of the Spanish Ministry of Education-FEDER through project SEC2010–03333. Maudos also acknowledges the financial support of the Valencian Government (PROMETEO/2009/066). We thank the editor and two anonymous referees for useful comments and suggestions on an earlier version; all remaining errors are our own.

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