TY  - JOUR
T1  - The Impact of Financial Liberalization on Economic Growth: The Indirect Link
AU - Al Samman, Hazem AU - Mouselli, Sulaiman AU - Azmeh, Chadi 
JO  - International Business Management
VL  - 11
IS  - 6
SP  - 1289
EP  - 1297
PY  - 2017
DA  - 2001/08/19
SN  - 1993-5250
DO  - ibm.2017.1289.1297
UR  - https://makhillpublications.co/view-article.php?doi=ibm.2017.1289.1297
KW  - financial development
KW  -economic growth
KW  -Financial liberalization
KW  -developing countries
KW  -contradicts
KW  -Foreign
AB  - This study investigates the impact of financial liberalization on economic growth through its effect
on the size and activity of the financial sector in a set of developing countries. We use the relative number and
share of Foreign banks as proxies for financial liberalization and liquid liabilities and claims on private sector
as share of GDP as proxies for the financial development. We find a negative real effect of the level of Foreign
banks entry on the size and activity of financial development. However, the effect of financial development on
economic growth is positive. This result contradicts the first component of Levine’s theory that Foreign bank’s
entry has positive effect on financial development but confirms the second component that financial
development has positive effect on economic growth. Our result is also consistent with Ghosh who finds that
a greater banking sector openness reduces economic growth in developing countries.
ER  -