Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/239144 
Year of Publication: 
2020
Citation: 
[Journal:] Journal of Risk and Financial Management [ISSN:] 1911-8074 [Volume:] 13 [Issue:] 3 [Publisher:] MDPI [Place:] Basel [Year:] 2020 [Pages:] 1-19
Publisher: 
MDPI, Basel
Abstract: 
In this paper, we use a rich dataset of several countries to analyze how sound political measures affect cross-border bank flows. Furthermore, our work is the first to comprehensively examine various components of political stability on the aforementioned subject using a larger sample than previous studies, and covering the period 1984-2013. Our paper will inform policy makers which particular aspects of political stability have a significant effect on cross-border bank flows and provide an outline on the favorable long term political and institutional development to increase such flows. We find that sound political measures-and therefore, higher political stability-increase cross-border bank flows, especially in advanced economies. Moreover, we find that in advanced economies, the political stability components; socioeconomic conditions, investment profile, corruption within the political system, religious tensions, ethnic tensions, and bureaucracy quality have a positive and close association with such bank flows. In our work, we also find that policies aiming to increase political stability have a stronger impact after the financial crisis of 2008, namely with regard to policies that affect socioeconomic conditions, investment profile, corruption within the political system and religious tensions
Subjects: 
cross-border bank flows
political stability
economic risk
financial risk
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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