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Impact of Financial Liberalization on Welfare: Evidence from Nepal

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  • Min B. SHRESTHA
  • Khorshed CHOWDHURY

Abstract

This study aims at examining the impact of financial liberalization on welfare and presents the empirical evidence from Nepal using ARDL modeling cointegration test method. The test results indicate that financial liberalization is positively associated with increased employment opportunities in both rural and urban areas but negatively associated with the bank credits to the poor. From these results, it can be argued that the net impact of financial liberalization on welfare is ambiguous. Specifically, the incidence of poverty is adversely affected by financial liberalization.

Suggested Citation

  • Min B. SHRESTHA & Khorshed CHOWDHURY, 2007. "Impact of Financial Liberalization on Welfare: Evidence from Nepal," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 7(1).
    • Handle: RePEc:eaa:aeinde:v:7:y:2007:i:1_15
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    Cited by:

    1. LIYANAGAMAGE, Champika, 2021. "Effect Of Inter-Industry Competition And Financial Freedom On Competitiveness Of Commercial Banking Sector," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 25(1), pages 30-47, March.
    2. Prof. Frank Westermann Ph.D., 2012. "Linkages between Sectoral Output Growth and Financial Development in Nepal," NRB Economic Review, Nepal Rastra Bank, Research Department, vol. 24(2), pages 15-30, October.
    3. Feldmann, Horst, 2012. "Banking deregulation around the world, 1970s to 2000s: The impact on unemployment," International Review of Economics & Finance, Elsevier, vol. 24(C), pages 26-42.
    4. Prof. Frank Westermann, Ph.D., 2012. "Linkages between Sectoral Output Growth and Financial Development in Nepal," NRB Economic Review, Nepal Rastra Bank, Economic Research Department, vol. 24(2), pages 15-30, October.

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    More about this item

    Keywords

    Financial Liberalization; Welfare; Employment; Income Distribution; South Asia; Nepal;
    All these keywords.

    JEL classification:

    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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