Week 4_Financial Crisis - Anatomy of Financial Crisis...

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Anatomy of Financial Crisis
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Outline Foreign Direct Investment (FDI), and Capital Financial Crisis
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Benefits of Foreign Direct Investments Trade and Investment Technology Transfers Competition Human Capital Enhancement Enterprise Development
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Is there a relationship between Financial Development and Economic Growth? Economic growth is stimulated by encouraging people not to hold true deadweight assets such as gold, jewellery, and other physical objects often prized as inflation hedges, but to trust the banking system and create more inside money. Financial Development operates largely through its effects in lowering the cost of external finance , which is more important for some industries and firms than others. In economies where inside finance is available (through entrepreneurship wealth or abundant retained earnings) the contribution of financial intermediaries to growth maybe relatively small.
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Banking crises are common throughout financial history. Currency crises are a more modern phenomenon. The liberalization of emerging markets has
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Week 4_Financial Crisis - Anatomy of Financial Crisis...

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