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164th Biweekly Academic Forum

作者:     日期:2016-01-04    来源:

1. Topic: Credit On the Simultaneity Problem in Capital Account Liberalization and Economic Growth Debate

2. Lecturer: Gou Qin, Lecturer of School of Finance, CUFE. She graduated from Peking University with Doctor of Economics degree in 2014. In 2009, she graduated from Nankai University and obtained the degree of Bachelor of Economics. During October 2011 and October 2012, she was a visiting scholar in New York University in America. Her main research area includes international finance, macroeconomics, empirical bank economics and so on. And her articles were published on China Economic Review, China & World Economy, Asia Development Policy Review, the World of Management, World Economy and Financial Research. Meanwhile, she ever took part in high level international academic meeting for many times.

3. Time: January, 7th, 2016(Thursday), 13:00-14:00

4. Place: 606 Meeting Room, Academic Meeting Hall

5. Host: Chen Rui, Lecturer of School of Finance, CUFE.

Abstract: We revisit the effect of capital account liberalization on economic growth by applying the instrumental variable approach to solve the simultaneity problem. We show that capital account liberalization has a significant positive average effect on real per capita gross domestic product (GDP) growth if, and only if, the endogeneity problem caused by the reverse causal effect of per capita GDP growth on capital account liberalization is adjusted for in the growth regression. Instrumental variables estimates show that a 1 percentage point increase in per capita GDP growth decreased capital account liberalization by over 0.02. After adjusting for the reverse causal effect, it shows that a 0.1 increase in capital account liberalization increased real per capita GDP growth by around 0.3 percentage points. This effects tend to be more pronounced for an economy with lower GDP, or higher degree of democracy. Further mechanism exploring shows that the incentive to increase investment drives the slow growing economies to open capital account more.