WTO Financial Services Commitments: Determinants and Impacton Financial Stability

Author/Editor:

Nico Valckx

Publication Date:

December 1, 2002

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

The paper investigates the factors that have influenced WTO members to take on their chosen level of liberalization commitments in the framework of liberalization of trade in financial services and the impact of such commitments on financial sector stability. The most important factors are economic growth, current account, trends in banking sector development, policy restrictiveness, and peer group effects. The econometric evidence suggests that more liberal commitments may be associated with greater vulnerability to currency and banking crises-most likely a short-term effect, which should be mitigated with time through increased market efficiency and better resource allocation.

Series:

Working Paper No. 2002/214

Subject:

Banking Banking crises Currency crises Economic sectors Financial crises Financial sector Financial services

English

Publication Date:

December 1, 2002

ISBN/ISSN:

9781451875003/1018-5941

Stock No:

WPIEA2142002

Pages:

35

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