The influence of domestic public debt market in the financial development: evidence of 52 countries in 1990-2020

Jiménez Sotelo, Renzo (2023): The influence of domestic public debt market in the financial development: evidence of 52 countries in 1990-2020. Published in: El Trimestre Económico , Vol. 90, No. 359 (4 July 2023): pp. 773-804.

Abstract

The objective of the study was to determine if a policy of preference for the domestic public debt market influences the development of the respective national financial system. This research finds that such influence does exist. Using panel data techniques, the causal relationship between the internal marketing of public debt and eight indicators of financial development was tested. The results confirm that the traditional theories of financial development were incomplete. Although the research shows that the preference for the internal public debt market influences financial development, and therefore economic development, it does not explain why in some less developed countries it is not given greater importance, an answer that would also involve the fields of study in which politics and ethics move.

• Item Type: MPRA Paper
• Language: English
• Keywords: sovereign curve; panel data; sovereign debt; economic development; securities market; financial policy; monetary policy; financial system.
• Subjects: A - General Economics and Teaching > A1 - General Economics > A13 - Relation of Economics to Social Values; C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C23 - Panel Data Models ; Spatio-temporal Models; D - Microeconomics > D7 - Analysis of Collective Decision-Making > D70 - General; E - Macroeconomics and Monetary Economics > E6 - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook > E61 - Policy Objectives ; Policy Designs and Consistency ; Policy Coordination; G - Financial Economics > G1 - General Financial Markets > G18 - Government Policy and Regulation; H - Public Economics > H6 - National Budget, Deficit, and Debt > H63 - Debt ; Debt Management ; Sovereign Debt; N - Economic History > N2 - Financial Markets and Institutions > N20 - General, International, or Comparative; O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development > O16 - Financial Markets ; Saving and Capital Investment ; Corporate Finance and Governance; P - Economic Systems > P1 - Capitalist Systems > P16 - Political Economy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q0 - General > Q01 - Sustainable Development

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