Document Type : Article-Based Dissertations
Authors
1 Department of Economics, Faculty of Economics and Management, Urmia University, Urmia, Iran
2 Economic and Management faculty, Urmia University, Urmia, Iran.
Abstract
The development of the financial sector is one of the most important goals of policy makers and researchers. The atmosphere of uncertainty and risks in the financial and economic sector can disrupt the development of the financial sector. In this study, the impact of the combined index of financial and economic risk on the multidimensional index of financial development in Asian countries has been investigated. Financial development includes the depth, accessibility and efficiency of financial institutions of countries.
Also, in this study, the approach of spatial effects, which is very important in the topic of financial and economic risk, has been used. The investigated sample includes 31 countries of the Asian continent during the years 2000-2021, and for the estimation of the models (for the robustness of the financial and economic risk results are estimated in separate models), the camera spatial panel approach (SDM approach) has been used.
The results indicate that both financial risk and economic risk had a negative impact on the composite index of financial development of Asian countries. Also, the financial and economic risk spatially has a negative effect on the financial development of the neighboring countries. Countries with a higher economic level experience higher financial development, but countries with abundant natural resources have low quality financial institutions.
Although East Asian countries have less energy and natural resources, they have had higher financial development than West Asian countries, which have large oil, gas, and mineral resources. Finally, countries with better governance indicators have more developed markets and financial institutions. The results of these studies have important policy recommendations for economic planners.
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