Hostname: page-component-7c8c6479df-nwzlb Total loading time: 0 Render date: 2024-03-28T16:21:49.771Z Has data issue: false hasContentIssue false

The Correlates of Change in International Financial Regulation

Published online by Cambridge University Press:  01 August 2014

Dennis Quinn*
Affiliation:
Georgetown University

Abstract

With which political and economic variables is change in international financial regulation robustly associated? I undertook multivariate regression analysis of this question using a quantitative measure of the regulation of international financial transactions. The measure was created by coding the laws of 64 nations. The associations between change in international financial regulation and measures of long-run economic growth, corporate taxation, government expenditures, and income inequality are estimated, using the models, methods, and data of Batro (1991), Deininger and Squire (1996a), Leamer (1983, 1985), and Levine and Renelt (1992). The findings point to a new agenda for research on international financial regulation.

Type
Articles
Copyright
Copyright © American Political Science Association 1997

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Alesina, Alberto, Grilli, Vittorio, and Milesi-Ferretti, Gian Maria. 1994. “The Political Economy of Capital Controls.” In Capital Mobility: the Impact on Consumption, Investment, and Growth, ed. Leiderman, Leonardo and Razin, Assaf. New York: Cambridge University Press.Google Scholar
Arrow, Kenneth J. 1973. “Economic Efficiency and Social Responsibility.” Public Policy 21(Summer):303–13.Google Scholar
Bates, Robert H., and Lien, Da-Hsiang Donald. 1985. “A Note on Taxation, Development, and Representative Government.” Politics & Society 14(03):5370.Google Scholar
Barro, Robert J., and Sala-i-Martin, Xavier. 1995. Economic Growth. New York: McGraw-Hill.Google Scholar
Barro, Robert J. 1991. “Economic Growth in a Cross-Section of Countries.” Quarterly Journal of Economics 106(05):407–43.Google Scholar
Baxter, Marianne, and Jermann, Urban J.. 1997. “The International Diversification Puzzle Is Worse Than You Think.” American Economic Review 87(03):170–80.Google Scholar
Beck, Nathaniel, and Katz, Jonathan N.. 1995. “What to Do (and Not to Do) with Time-Series-Cross-Section Data in Comparative Politics.” American Political Science Review 89(09):634–47.Google Scholar
Bekaert, Geert, and Harvey, Campbell R.. 1995. “Time-Varying World Market Integration.” Journal of Finance 50(06):403–44.Google Scholar
Bovenberg, Lans, Andersson, Kriser, Aramaki, Kenji, and Chand, Sheetal K.. 1990. “Tax Incentives and International Capital Flows.” In Taxation in the Global Economy, ed. Razin, Assaf and Slemrod, Joel. Chicago: University of Chicago Press.Google Scholar
Caves, Richard E. 1996. Multinational Enterprise and Economic Analysis, 2d ed. New York: Cambridge University Press.Google Scholar
Cohen, Benjamin J. 1996. “Phoenix Risen: The Resurrection of Global Finance.” World Politics 48(01):268–96.CrossRefGoogle Scholar
Crenshaw, Edward. 1992. “Cross-National Determinants of Income Inequality: A Replication and Extension Using Ecological-Evolutionary Theory.” Social Forces 71(12):339–63.Google Scholar
Cukierman, Alex. 1992. Central Bank Strategy, Credibility, and Independence. Cambridge: MIT Press.Google Scholar
Deininger, Klaus, and Squire, Lyn. 1996a. “Measuring Income Inequality: A New Data-Base.” World Bank. Typescript.Google Scholar
Deininger, Klaus, and Squire, Lyn. 1996b. “New Ways of Looking at Old Issues: Inequality and Growth.” World Bank. Typescript.Google Scholar
Diaz-Alejandro, Carlos. 1985. “Good-bye Financial Repression, Hello Financial Crash.” Journal of Development Economics 19(11):124.CrossRefGoogle Scholar
Dooley, Michael P. 1995. “A Survey of Academic Literature on Controls over International Capital Transactions.” Cambridge: National Bureau of Economic Research Working Paper #5352.Google Scholar
Dornbusch, Rudiger. 1976. “Expectations and Exchange Rate Dynamics.” Journal of Political Economy 84(12):1161–76.Google Scholar
Edwards, Sebastian. 1984. “The Order of Liberalization of the External Sector in Developing Countries.” Princeton Essays in International Finance, #156. Princeton, NJ: Princeton University Press.Google Scholar
Eichengreen, Barry, Tobin, James, and Wyplosz, Charles. 1995. “Two Cases for Sand in the Wheels of International Finance.” The Economic Journal 105(01):162–72.Google Scholar
Epstein, Gerald A., and Schor, Juliet B.. 1992. “Structural Determinants and Economic Effects of Capital Controls.” In Financial Openness and National Autonomy, ed. Banuri, T. and Schor, J.. Oxford: Clarendon.Google Scholar
Fagerberg, Jan. 1994. “Technology and International Differences in Growth Rates.” Journal of Economic Literature 32(09):1147–75.Google Scholar
Freeman, John R. 1992. “International Finance and Democracy: Proposal to the NSF.” Department of Political Science, University of Minnesota. Typescript.Google Scholar
Freeman, John R. 1996. “The Politics of International Finance: A Pilot Study.” Department of Political Science, University of Minnesota. Typescript.Google Scholar
Freeman, John R., Houser, Daniel, Kellstedt, Paul M., and Williams, John T.. 1997. “Unit Roots and Causal Inference in Political Science.” University of Minnesota. Typescript.Google Scholar
Frenkel, Jacob A., Razin, Assaf, and Sadka, Efraim. 1991. International Taxation in an Integrated World. Cambridge: MIT Press.Google Scholar
Frieden, Jeffry A. 1991. “Invested Interests: the Politics of National Economic Policies in a World of Global Finance.” International Organization 45(Autumn):425–51.CrossRefGoogle Scholar
Garrett, Geoffrey. 1995. “Capital Mobility, Trade, and the Domestic Politics of Economic Policy.” International Organization 49(Autumn):657–87.Google Scholar
Goodman, John B., and Pauly, Louis W.. 1993. “The Obsolescence of Capital Controls?: Economic Management in an Age of Global Markets.” World Politics 46(10):5082.CrossRefGoogle Scholar
Gordon, Roger H., and MacKie-Mason, Jeffrey K.. 1995. “Why Is There Corporate Taxation in a Small Open Economy: The Role of Transfer Pricing and Income Shifting.” In The Effects of Taxation on Multinational Corporations, ed. Feldstein, Martin, Hines, J., and Hubbard, Glenn. Chicago: University of Chicago Press.Google Scholar
Granato, Jim, Inglehart, Ronald, and Leblang, David. 1996. “The Effect of Cultural Values on Economic Development: Theory, Hypotheses, and Some Empirical Tests.” American Journal of Political Science 40(08):607–31.CrossRefGoogle Scholar
Grilli, Vittorio, and Milesi-Ferretti, Gian Maria. 1995. “Economic Effects and Structural Determinants of Capital Controls.” IMF Working Paper #95131. Washington, D.C.: International Monetary Fund.Google Scholar
Haggard, Stephan, and Maxfield, Sylvia. 1996. “The Political Economy of Financial Internationalization in the Developing World.” International Organization 50(Winter):3568.CrossRefGoogle Scholar
Hastings, Laura. 1993. “Regulatory Revenge: The Politics of Free-Market Financial Reforms in Chile.” In The Politics of Finance in Developing Countries, ed, Haggard, Stephan, Lee, Chung H., and Maxfield, Sylvia. Ithaca: Cornell University Press.Google Scholar
International Monetary Fund. Various years, 1979 on. Annual Report on Exchange Arrangements and Exchange Restrictions (previously Annual Report on Exchange Restrictions, 19501978). Washington, DC: International Monetary Fund.Google Scholar
International Monetary Fund. Various years. Government Finance Statistics Yearbook. Washington, DC: International Monetary Fund.Google Scholar
Jackman, Robert W., and Miller, Ross A.. 1996. “A Renaissance of Political Culture?American Journal of Political Science 40(08):632–59.CrossRefGoogle Scholar
Johnson, Chalmers. 1982. MITI and the Japanese Miracle. Stanford: Stanford University Press.Google Scholar
King, Robert G., and Levine, Ross. 1993. “Finance and Growth: Schumpeter Might Be Right.” Quarterly Journal of Economics 108(08):717–37.CrossRefGoogle Scholar
Kurzer, Paulette. 1993. Business and Banking: Political Change and Economic Integration in Western Europe. Ithaca: Cornell University Press.Google Scholar
Learner, Edward. 1983. “Let's Take the Con Out of Econometrics.” American Economic Review 73(03):3143.Google Scholar
Learner, Edward E. 1985. “Sensitivity Analyses Would Help.” American Economic Review 75(06):308–13.Google Scholar
Leblang, David A. 1995. “Are Capital Controls Obsolete? Evidence from the Developed and Developing World, 1967–86.” Paper presented at the 1995 annual meeting of the Midwest Political Science Association, Chicago.Google Scholar
Levine, Ross, and Renelt, David. 1992. “A Sensitivity Analysis of Cross-Country Growth Regressions.” American Economic Review 82(09):942–63.Google Scholar
Levine, Ross, and Zervos, Sarah. 1993. “What We Have Learned About Policy and Growth from Cross-country Regressions.” American Economic Review 83(05):426–30.Google Scholar
Lindblom, Charles E. 1977. Politics and Markets: The World's Political-Economic System. New York: Basic Books.Google Scholar
Mathieson, Donald J., and Rojas-Suárez, Liliana. 1993. “Liberalization of the Capital Account: Experiences and Issues.” International Monetary Fund Occasional Paper #103. Washington, D.C.: International Monetary Fund.Google Scholar
Maxfield, Sylvia. 1997. “What We Need to Know Before We Know Anything about the Political Implications of Financial Intermediation.” Paper presented at the 1997 annual meeting of the Midwest Political Science Association, Chicago.Google Scholar
Milner, Wesley T. 1996. “Open for Business? A Pooled Cross-Sectional View of Financial Openness in Developed and Developing World.” Paper presented at the annual meeting of the Southwestern Social Science Association, Houston.Google Scholar
Nam, Sang-Woo, and Lee, Chung H.. 1995. “Korea.” In Financial Systems and Economic Policy in Developing Countries, ed. Haggard, Stephan and Lee, Chung H.. Ithaca, NY: Cornell University Press.Google Scholar
Nielsen, François, and Alderson, Arthur S.. 1995. “Income Inequality, Development, and Dualism: Results from an Unbalanced Crossnational Panel.” American Sociological Review 60(10):674701.Google Scholar
Offe, Claus. 1984. Contradictions of the Welfare State. Cambridge: MIT Press.Google Scholar
O'Neill, Donal. 1995. “Education and Income Growth: Implications for Cross-Country Inequality.” Journal of Political Economy 103(12):1289–301.CrossRefGoogle Scholar
Pacek, Alexander, and Radcliff, Benjamin. 1995. “The Political Economy of Competitive Elections in the Developing World.” American Journal of Political Science 39(08):745–59.Google Scholar
Pagano, Marcel. 1993. “Financial Markets and Growth: An Overview.” European Economic Review 37(2):613–22.CrossRefGoogle Scholar
Page, Benjamin I. 1996. “Trouble for Workers and the Poor: Economic Globalization and the Reshaping of American Politics.” Paper presented at the conference on “The Clinton Years in Perspective,” University of Montreal, 6–8 October.Google Scholar
Pindyck, Robert S. 1991. “Irreversibility, Uncertainty, and Investment.” Journal of Economic Literature 29(12):1110–48.Google Scholar
Powell, G. Bingham, and Whitten, Guy. 1993. “A Cross-national Analysis of Economic Voting.” American Journal of Political Science 37(05):391414.Google Scholar
Przeworski, Adam and Wallerstein, Michael. 1988. “Structural Dependence of the State on Capital.” American Political Science Review 82(03):1130.Google Scholar
Quinn, Dennis P. 1992. “International Capital Flows: A Twenty-One Country Study of Financial Liberalization 1950–1988.” Paper presented at the annual meeting of the American Political Science Association, Chicago.Google Scholar
Quinn, Dennis P., and Inclán, Carla. 1997. “The Origins of Financial Openness: A Study of Current and Capital Account Liberalization.” American Journal of Political Science 41(07):771813.Google Scholar
Quinn, Dennis P., and Shapiro, Robert Y.. 1991. “Business Political Power: The Case of Taxation.” American Political Science Review 85(09):856–71.CrossRefGoogle Scholar
Quinn, Dennis P., and Toyoda, A. Maria. 1997. “Measuring International Financial Regulation.” Georgetown University. Typescript.Google Scholar
Quinn, Dennis P., and Woolley, John T.. 1996. “Growth, Inequality, and Economic Performance.” Paper presented at the annual meeting of the American Political Science Association, San Francisco.Google Scholar
Quirk, Peter J., and Evans, Owen. 1995. “Capital Account Convertibility: Review of Experience and Implications for IMF Policies.” International Monetary Fund Occasional Paper #131. Washington, DC: International Monetary Fund.Google Scholar
Razin, Assaf, and Rose, Andrew K.. 1994. “Business-Cycle Volatility and Openness: An Exploratory Cross-Sectional Analysis.” In Capital Mobility: the Impact on Consumption, Investment, and Growth, ed. Leiderman, Leonardo and Razin, Assaf. New York: Cambridge University Press.Google Scholar
Smith, Adam. [1776] 1976. An Inquiry into the Nature and Causes of The Wealth of Nations, ed., Cannan, Edwin, Chicago: University of Chicago Press.Google Scholar
Steinmo, Sven. 1994. “The End of Redistribution? International Pressures and Domestic Tax Policy Choices.” Challenge (November/December):917.Google Scholar
Swank, Duane. 1996. “Culture, Institutions, and Economic Growth.” American Journal of Political Science 40(08):660–79.Google Scholar
Swank, Duane. 1996. “Funding the Welfare State, Part I: Global Capital and the Taxation of Business in Advanced Market Economies.” Paper presented at the annual meeting of the American Political Science Association, San Francisco.Google Scholar
Sweeney, Richard J. N.d. “The Information Costs of Capital Controls.” In Capital Controls in Emerging Economies, ed. Rios, Christine P. and Sweeney, Richard J.. Boulder: Westview Press. Forthcoming.Google Scholar
Summers, Robert and Heston, Alan. 1991. “The Penn World Table (Mark 5): An Expanded Set of International Comparisons, 1950–1988.” Quarterly Journal of Economics 106(05):327–68.Google Scholar
Wallerstein, Michael, and Przeworski, Adam. 1995. “Capital Taxation with Open Border.” Review of International Political Economy 2(Summer):425–45.Google Scholar
White, Halbert. 1984. Asymptotic Theory for Econometricians. New York: Academic Press.Google Scholar
Woolley, John T. 1994. “The Study of the Politics of Monetary Policy: A Critical Review.” Journal of Public Policy 14(05):5785.CrossRefGoogle Scholar
The World Bank. 1993. The East Asian Miracle: Economic Growth and Public Policy. New York: Oxford University Press.Google Scholar
The World Factbook, 1989. Washington, D.C.: Government Printing Office.Google Scholar
Zysman, John. 1983. Governments, Markets, and Growth. Ithaca, NY: Cornell University Press.Google Scholar