Financial repression and external openness in an endogenous growth model

Sung Jin Kang, Yasuyuki Sawada

Research output: Contribution to journalArticlepeer-review

8 Citations (Scopus)


An endogenous growth model has been developed that extends Sidrauski (1967), Roubini and Sala-i-Martin (1992,1995) and Lucas (1988) by combining financial development, human capital investment, and external openness. Financial development and trade liberalization are shown to increase the economic growth rate by increasing the marginal benefits of human capital investment. Expansionary governments are, however, provided with an incentive to increase the money supply growth rate, to repress the financial sector, to close its economy, and to impose a high proportional income tax rate.

Original languageEnglish
Pages (from-to)427-443
Number of pages17
JournalJournal of International Trade and Economic Development
Issue number4
Publication statusPublished - 2000 Dec
Externally publishedYes


  • Endogenous growth
  • Financial repression
  • Human capital
  • Openness

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development
  • Aerospace Engineering


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