Credit Constraints, Political Instability, and Capital Accumulation /

We investigate the complex interactions between credit constraints, political instability, and capital accumulation using a novel approach based on Kiyotaki and Moore's (1997) theoretical framework. Drawing on a unique firm-level data set from Middle-East and North Africa (MENA), empirical find...

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Bibliographic Details
Main Author: Herrala, Risto
Other Authors: Turk-Ariss, Rima
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2013.
Series:IMF Working Papers; Working Paper ; No. 2013/246
Online Access:Full text available on IMF
Description
Summary:We investigate the complex interactions between credit constraints, political instability, and capital accumulation using a novel approach based on Kiyotaki and Moore's (1997) theoretical framework. Drawing on a unique firm-level data set from Middle-East and North Africa (MENA), empirical findings point to a large and significant effect of credit conditions on capital accumulation and suggest that continued political unrest worsens credit constraints. The results support the view that financial development measured by a relaxing of financial constraints is key to macroeconomic development.
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Physical Description:1 online resource (26 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students