Financial Liberalization and Economic Development

This work makes significant methodological contribution in the field of impact evaluation by proposing a new aggregated framework for the evaluation of overall impact of financial liberalization. The framework is useful for the impact evaluation of every public policy as it evaluates the impact of a policy or programme against three main dimensions of development, viz: economic growth, redistribution of income and stability. To conduct the empirical analysis using time series data, this work develops a sequential procedure for the unit root test based on a general to specific approach and employs autoregressive distributed lag (ARDL) modelling approach to cointegration analysis. It also presents a comprehensive discussion on the relationship and causality between the financial development and economic growth.