Financialization and firm-level investment in developing and emerging economies

The Institute of Economics will hold a webinar meeting as part of its Seminar Series on Tuesday, January 19, 2021: Daniele Tori from the Open University Business School will present the paper "Financialization and firm-level investment in developing and emerging economies ".

Abstract:

This article analyses the effects of financialization on non-financial companies’ (NFCs) investment and explores the interactions between financialization and the structural and institutional features of developing and emerging economies (DEEs). The authors estimate the effects of financialisation on physical investment for a sample of DEEs using panel data based on the balance-sheets of publicly listed NFCs. Their main contribution is to assess the interactions between the financialization of the NFCs and country-level financial development, financial reform, capital account openness, and global value chain participation. The authors find that the effects of the financialization of the NFCs in DEEs are highly context-specific. Stock market development, financial reforms for liberalization, capital account openness, and participation in the global value chains are associated with more pronounced negative effects of financialization on investment. The analysis provides novel econometric evidence regarding the particular sources of variation in the financialization of corporations in DEEs.

All interested participants are welcome to join online at the following link. External participants need to contact the organisers via email to grant access to the seminar.