Financial repression and external openness in an endogenous growth model

Sung Jin Kang, Yasuyuki Sawada

Research output: Contribution to journalArticle

6 Citations (Scopus)

Abstract

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
Volume9
Issue number4
Publication statusPublished - 2000 Dec 1

Fingerprint

endogenous growth
capital investment
human capital
repression
money supply
trade liberalization
income tax
Taxation
liberalization
economic growth
incentive
Economics
economy
rate

Keywords

  • Endogenous growth
  • Financial repression
  • Human capital
  • Openness

ASJC Scopus subject areas

  • Development
  • Geography, Planning and Development

Cite this

Financial repression and external openness in an endogenous growth model. / Kang, Sung Jin; Sawada, Yasuyuki.

In: Journal of International Trade and Economic Development, Vol. 9, No. 4, 01.12.2000, p. 427-443.

Research output: Contribution to journalArticle

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