- 권한신청
- P-ISSN1738-3110
- E-ISSN2093-7717
- SCOPUS, ESCI
Foreign Capital Flows, Banking Stability and the Role of International Trade Cooperation and Distribution an Empirical Analysis from the ASEAN Region
Foreign Capital Flows, Banking Stability and the Role of International Trade Cooperation and Distribution an Empirical Analysis from the ASEAN Region
LUONG, Thuy Thi Thu (Ho Chi Minh University of Banking (HUB))
Abstract
Purpose: Although foreign capital flows have played a vital role in fostering the economic growth in recipient countries, there are some concerns about the adverse impact of international capital flows on the banking stability. Hence, the study revisits this issue to explore the relationship between the different types of foreign investments and banking stability in ASEAN region. Research design, data and methodology: Based on the bank-level data of 96 commercial banks and country-level in six ASEAN countries from 2008 to 2019, we perform the multivariate regression analysis and provide a variety of robustness tests. Results: Our empirical evidence shows the volatility of foreign portfolio investments has significantly negative effect on the banking stability, besides that of foreign other investments has the similar influence but the result is relatively less pronounced in some robustness tests. Additionally, increasing trade cooperation and international distribution may lead countries to face higher risk of banking instability driven from these international investments. Meanwhile, the impact of foreign direct investments is positive, but the evidence is the least obvious. Conclusions: Our findings suggest policy-makers in ASEAN and emerging nations as a whole should carefully consider when building policies-related to mitigate the adverse impact of foreign capital flows.
- keywords
- Foreign Capital Flows, Banking Stability, Distribution, International Trade Cooperation, ASEAN countries
참고문헌
Alfaro, L., Chanda, A., Kalemli-Ozcan, S., & Sayek, S. (2010). Does foreign direct investment promote growth? Exploring the role of financial markets on linkages. Journal of Development Economics, 91(2), 242-256. https://doi.org/10.1016/j.jdeveco.2009.09.004
Anggitawati, D., & Ekaputra, I. A. (2020). Foreign Portfolio Investment Flows and Exchange Rate: Evidence in Indonesia. Emerging Markets Finance and Trade, 56(2), 260-274. https://doi.org/10.1080/1540496X.2018.1496419
Arellano, M., & Bond, S. (1991). Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations. The Review of Economic Studies, 58(2), 277-297. https://doi.org/10.2307/2297968
Banerjee, R., Devereux, M. B., & Lombardo, G. (2016). Selforiented monetary policy, global financial markets and excess volatility of international capital flows. Journal of International Money and Finance, 68(11), 275-297. https://doi.org/10.1016/j.jimonfin.2016.02.007
Blanchard, O., Ostry, J. D., Ghosh, A. R., & Chamon, M. (2016). Capital Flows: Expansionary or Contractionary? American Economic Review, 106(5), 565-569. https://doi.org/10.1257/aer.p20161012
Blundell, R., & Bond, S. (1998). Initial conditions and moment restrictions in dynamic panel data models. Journal of Econometrics, 87(1), 115-143. https://doi.org/10.1016/S0304-4076(98)00009-8
Borensztein, E., De Gregorio, J., & Lee, J.-W. (1998). How does foreign direct investment affect economic growth?. Journal of International Economics, 45(1), 115-135. https://doi.org/10.1016/S0022-1996(97)00033-0
Bruno, V., & Shin, H. S. (2014). Assessing Macroprudential Policies: Case of South Korea*. The Scandinavian Journal of Economics, 116(1), 128-157. https://doi.org/10.1111/sjoe.12037
Bruno, V., & Shin, H. S. (2017). Global Dollar Credit and Carry Trades: A Firm-Level Analysis. The Review of Financial Studies, 30(3), 703-749. https://doi.org/10.1093/rfs/hhw099
Chan, S.-G., Koh, E. H. Y., Zainir, F., & Yong, C.-C. (2015). Market structure, institutional framework and bank efficiency in ASEAN 5. Journal of Economics and Business, 82(11), 84-112. https://doi.org/10.1016/j.jeconbus.2015.07.002
Combes, J.-L., Kinda, T., & Plane, P. (2012). Capital flows, exchange rate flexibility, and the real exchange rate. Journal of Macroeconomics, 34(4), 1034-1043. https://doi.org/10.1016/j.jmacro.2012.08.001
Dang, V. C., & Nguyen, Q. K. (2021). Determinants of FDI attractiveness: Evidence from ASEAN-7 countries. Cogent Social Sciences, 7(1), 1-15. https://doi.org/10.1080/23311886.2021.2004676
Daniel, B. C., & Jones, J. B. (2007). Financial liberalization and banking crises in emerging economies. Journal of International Economics, 72(1), 202-221. https://doi.org/10.1016/j.jinteco.2006.07.009
Derbali, A., & Lamouchi, A. (2020). Global financial crisis, foreign portfolio investment and volatility: Impact analysis on select Southeast Asian markets. Pacific Accounting Review, 32(2), 177-195. https://doi.org/10.1108/PAR-07-2019-0090
Furceri, D., Guichard, S., & Rusticelli, E. (2012). The effect of episodes of large capital inflows on domestic credit. The North American Journal of Economics and Finance, 23(3), 325-344. https://doi.org/10.1016/j.najef.2012.03.005
Ghosh, A. R., Ostry, J. D., & Qureshi, M. S. (2015). Exchange Rate Management and Crisis Susceptibility: A Reassessment. IMF Economic Review, 63(1), 238-276. https://doi.org/10.1057/imfer.2014.29
Hegerty, S. W. (2011). Do international capital flows smooth or transmit macroeconomic volatility? Time-series evidence from emerging markets. Economics Bulletin, 31(2), 1659-1672.
Ho, S.-H., & Saadaoui, J. (2022). Bank credit and economic growth: A dynamic threshold panel model for ASEAN countries. International Economics, 170(3), 115-128. https://doi.org/10.1016/j.inteco.2022.03.001
Igan, D., & Tan, Z. (2017). Capital Inflows, Credit Growth, and Financial Systems. Emerging Markets Finance and Trade, 53(12), 2649-2671. https://doi.org/10.1080/1540496X.2017.1339186
Imansyah, I., & Nasrudin, N. (2016). The Impact of Economic Integration and Macroeconomic on Indonesia Foreign Direct Investment (FDI): A Panel Gravity Model. Journal of Distribution Science, 14(4), 33-38. https://doi.org/10.15722/jds.14.4.201604.33
Kaminsky, G. L., & Schmukler, S. L. (2008). Short-Run Pain, Long-Run Gain: Financial Liberalization and Stock Market Cycles. Review of Finance, 12(2), 253-292. https://doi.org/10.1093/rof/rfn002
Kim, E. H., & Singal, V. (2000). The fear of globalizing capital markets. Emerging Markets Review, 1(3), 183-198. https://doi.org/10.1016/S1566-0141(00)00014-5
Laeven, L., & Levine, R. (2009). Bank governance, regulation and risk taking. Journal of Financial Economics, 93(2), 259-275. https://doi.org/10.1016/j.jfineco.2008.09.003
Le, T. D. (2020). Market discipline and the regulatory change:Evidence from Vietnam. Cogent Economics & Finance, 8(1), 1-12. https://doi.org/10.1080/23322039.2020.1757801
Levine, R. (2001). International Financial Liberalization and Economic Growth. Review of International Economics, 9(4), 688-702. https://doi.org/10.1111/1467-9396.00307
Lim, S. Y., & Ho, C. M. (2013). Nonlinearity in ASEAN-5 exportled growth model: Empirical evidence from nonparametric approach. Economic Modelling, 32(5), 136-145. https://doi.org/10.1016/j.econmod.2013.01.044
Nguyen, C. D. T. (2022). Impact of International Trade Cooperation and Distribution on Foreign Direct Investment:Evidence from Vietnam. Journal of Distribution Science, 20(4), 77-83. https://doi.org/10.15722/JDS.20.04.202204.77
Phan, D. H. B., Iyke, B. N., Sharma, S. S., & Affandi, Y. (2021). Economic policy uncertainty and financial stability – Is there a relation? Economic Modelling, 94(2), 1018-1029. https://doi.org/10.1016/j.econmod.2020.02.042
Sula, O., & Willett, T. D. (2009). The reversibility of different types of capital flows to emerging markets. Emerging Markets Review, 10(4), 296-310. https://doi.org/10.1016/j.ememar.2009.08.001
Tran, D. V., & Lu, C. H. (2021). Market Discipline in the Interbank Market: Evidence from an Emerging Country. WSEAS TRANSACTIONS ON BUSINESS AND ECONOMICS, 18(7), 1028-1037. https://doi.org/10.37394/23207.2021.18.97
Tran, D. V, Nguyen, T. D, & Lu, C. H. (2021). Does the dividend policy signal quality? Investigation on the bank funding costs, and market discipline. Economics Bulletin, 41(3), 2029-2040.
- 다운로드 수
- 조회수
- 0KCI 피인용수
- 0WOS 피인용수