Financial Openness, Democracy, and Redistributive Policy
Financial Openness, Democracy, and Redistributive Policy:

June 2000 - What explains the spread of both democracy and financial openness at this time in history, given the constraining impact of financial market integration on national policy autonomy? International policy coordination is part of the answer, but not all. Also important is the presence of co...

Ausführliche Beschreibung

Gespeichert in:
Bibliographische Detailangaben
1. Verfasser: Dailami, Mansoor (VerfasserIn)
Format: Elektronisch E-Book
Sprache:English
Veröffentlicht: Washington, D.C The World Bank 1999
Schlagworte:
Banks and Banking Reform
Bonds
Capital Flows
Capital Movements
Currencies and Exchange Rates
Debt Markets
Developing Countries
Economic Efficiency
Economic Theory and Research
Emerging Markets
Finance and Financial Sector Development
Financial Literacy
Financial Openness
Free Capital
Future
Governance
Governance Indicators
Government Policies
Information Technologies
Insurance
International Capital
International Capital Mobility
International Financial Markets
International Financial System
International Lending
Labor Policies
Macroeconomic Management
Macroeconomics and Economic Growth
Market
Market Integration
Moral Hazard
Political Economy
Private Sector Development
Social Protections and Labor
Online-Zugang:DE-522
DE-12
DE-521
DE-1102
DE-1046
DE-1047
DE-858
DE-Aug4
DE-573
DE-M347
DE-92
DE-1051
DE-898
DE-859
DE-860
DE-1049
DE-863
DE-862
DE-523
DE-2070s
DE-M352
DE-Re13
DE-70
DE-128
DE-22
DE-155
DE-150
DE-91
DE-384
DE-473
DE-19
DE-355
DE-703
DE-20
DE-706
DE-29
DE-739
Volltext
Zusammenfassung:June 2000 - What explains the spread of both democracy and financial openness at this time in history, given the constraining impact of financial market integration on national policy autonomy? International policy coordination is part of the answer, but not all. Also important is the presence of cost-effective redistributive schemes that provide insurance against the risk of financial instability. The debate about the relationship between democratic forms of government and the free movement of capital across borders dates to the 18th century. It has regained prominence as capital on a massive scale has become increasingly mobile and as free economies experience continuous pressure from rapidly changing technology, market integration, changing consumer preferences, and intensified competition. These changes imply greater uncertainty about citizens' future income positions, which could prompt them to seek insurance through the marketplace or through constitutionally arranged income redistribution. As more countries move toward democracy, the availability of such insurance mechanisms to citizens is key if political pressure for capital controls is to be averted and if public support for an open, liberal international financial order is to be maintained. Dailami briefly reviews how today's international financial system evolved from one of mostly closed capital accounts immediately after World War II to today's enormous, largely free-flowing market. Drawing on insights from the literature on public choice and constitutional political economy, Dailami develops an analytical framework for a welfare cost-benefit analysis of financial openness to international capital flows. The main welfare benefits of financial openness derive from greater economic efficiency and increased opportunities for risk diversification.
[Fortsetzung 1. Abstract] The welfare costs relate to the cost of insurance used as a mechanism for coping with the risks of financial volatility. These insurance costs are the economic losses associated with redistribution, including moral hazard, rent-seeking, and rent-avoidance. A cross-sectional analysis of a large sample of developed and developing countries shows the positive correlation between democracy (as defined by political and civil liberty) and financial openness. More rigorous econometric investigation using logit analysis and controlling for level of income also shows that redistributive social policies are key in determining the likelihood that countries can successfully combine an openness to international capital mobility with democratic forms of government. This paper - a product of Governance, Regulation, and Finance, World Bank Institute- is part of a broader research effort on The Quality of Growth. The author may be contacted at mdailami@worldbank.org
Beschreibung:Weitere Ausgabe: Dailami, Mansoor: Financial Openness, Democracy, and Redistributive Policy
Beschreibung:1 Online-Ressource (1 online resource (38 p.))
Login für die Nachverfolgung von Bestellungen und Vormerkungen
Volltext öffnen

Ähnliche Einträge