Effects of Financial and Trade Globalization on Total Factor Productivity Growth in Emerging Economies

Title

Effects of Financial and Trade Globalization on Total Factor Productivity Growth in Emerging Economies

Creator

Zhao Z.; Pal S.; Mahalik M.K.; Gozgor G.

Description

This article considers the annual sample from 1984 to 2019 in a panel dataset of 20 emerging economies (i.e. Brazil, Chile, China, Colombia, the Czech Republic, Egypt, Greece, Hungary, India, Indonesia, Kuwait, Malaysia, Mexico, Peru, the Philippines, Poland, Saudi Arabia, South Africa, Thailand, and Turkey) given by Morgan Stanley Capital International (MSCI), to explore the effects of trade and financial globalization on total factor productivity (TFP) growth. It considers domestic credit to the private sector by banks as a percentage of gross domestic product (GDP), labor force, and total gross fixed capital formation as a percentage of GDP as control variables in the total factor productivity function. The article considers the direct effects of trade and financial globalization. It also checks the moderating impact of domestic credit on TFP. The long-run estimation shows that domestic credit, labor force, and financial globalization reduce TFP growth, whereas investments and trade globalization enhance it. Interestingly, their moderating effect enhances TFP in the long run. The policy implications are also discussed. 2023 Taylor & Francis Group, LLC.

Source

Emerging Markets Finance and Trade, Vol-60, No. 2, pp. 328-344.

Date

2024-01-01

Publisher

Routledge

Subject

emerging economies; financial globalization; Total factor productivity; trade globalization

Coverage

Zhao Z., Institutes of Science and Development, Chinese Academy of Sciences, Beijing, China; Pal S., Department of Humanities and Social Sciences, Indian Institute of Technology Kharagpur, Kharagpur, India, School of Business and Management, Christ University (Deemed to be University), Bengaluru, India; Mahalik M.K., Department of Humanities and Social Sciences, Indian Institute of Technology Kharagpur, Kharagpur, India; Gozgor G., School of Management, University of Bradford, Bradford, United Kingdom, Faculty of Political Sciences, Istanbul Medeniyet University, Istanbul, Turkey, Adnan Kassar School of Business, Lebanese American University, Beirut, Lebanon

Rights

Restricted Access

Relation

ISSN: 1540496X

Format

Online

Language

English

Type

Article

Identifier

https://doi.org/10.1080/1540496X.2023.2223934

https://www.scopus.com/inward/record.uri?eid=2-s2.0-85164455716&doi=10.1080%2f1540496X.2023.2223934&partnerID=40&md5=5352b6b95ddaad144512758e671f84ae