Credit Constraints, Political Instability, and Capital Accumulation
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
We investigate the complex interactions between credit constraints, political instability, and capital accumulation using a novel approach based on Kiyotaki and Moore’s (1997) theoretical framework. Drawing on a unique firm-level data set from Middle-East and North Africa (MENA), empirical findings point to a large and significant effect of credit conditions on capital accumulation and suggest that continued political unrest worsens credit constraints. The results support the view that financial development measured by a relaxing of financial constraints is key to macroeconomic development.
Series:
Working Paper No. 13/246
Subject:
Algeria Bahrain Capital accumulation Credit ceilings Djibouti Egypt Iran, Islamic Republic of Iraq Jordan Kuwait Lebanon Libyan Arab Jamahiriya Middle East Morocco North Africa Oman Qatar Saudi Arabia Syrian Arab Republic Transition economies Tunisia United Arab Emirates West Bank and Gaza Yemen, Republic of
English
Publication Date:
December 16, 2013
ISBN/ISSN:
9781484303085/1018-5941
Stock No:
WPIEA2013246
Format:
Paper
Pages:
26
Please address any questions about this title to publications@imf.org