The literature on the benefits and costs of financial globalization for developing countries has exploded in recent years, but along many disparate channels and with a variety of apparently conflicting results. For instance, there is still little robust evidence of the growth benefits of broad...

This study provides a candid, systematic, and critical review of recent evidence on this complex subject. Based on a review of the literature and some new empirical evidence, it finds that (1) in spite of an apparently strong theoretical presumption, it is difficult to detect a strong and robust...

The global financial crisis serves as a reminder of the risks of financial globalization. After grappling with surges of capital inflows earlier in this decade, many emerging market and developing economies experienced a sharp reversal of those inflows in late 2008 as a result of the crisis....

We review the large literature on various economic policies that could help developing economies effectively manage the process of financial globalization. Our central findings indicate that policies promoting financial sector development, institutional quality, and trade openness appear to help...

Intro -- Contents -- EXECUTIVE SUMMARY -- I. INTRODUCTION -- II. A BRIEF OVERVIEW OF THEORY -- III. MEASURING FINANCIAL OPENNESS -- IV. PATTERNS OF FINANCIAL GLOBALIZATION -- V. MACROECONOMIC EVIDENCE ON EFFECTS OF FINANCIAL GLOBALIZATION -- VI. HOW DOES THE COMPOSITION OF CAPITAL FLOWS MATTER?...

This paper provides a comprehensive assessment of empirical evidence about the impact of financial globalization on growth and volatility in developing countries. The results suggest that it is difficult to establish a robust causal relationship between financial integration and economic growth....

We review the large literature on various economic policies that could help developing economies effectively manage the process of financial globalization. Our central findings indicate that policies promoting financial sector development, institutional quality and trade openness appear to help...