Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
7364717 | Journal of International Financial Markets, Institutions and Money | 2015 | 50 Pages |
Abstract
This paper explores whether the level of de facto financial integration of banks in a country increases the incidence of systemic banking crises. The paper computes a measure of financial integration based on network statistics of banks participating in the global market of inter-bank syndicated loans. The network statistics used are indegree, outdegree, betweenness, clustering coefficients, authority, and hub centrality. The paper fits a count data model in the cross-section for the period 1980-2007, and finds that the level of financial integration of the average bank in a country is a robust determinant of the incidence of banking crises. While borrowing (weighted indegree) is positively associated with a higher incidence of crises, betweenness is associated with a lower incidence. That is, the more important is the average bank of a country to the global bank network, as captured by betweenness, the smaller the number of crises the country experiences.
Keywords
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Julian Caballero,