Beneficiary of the Financial Liberalization Essay

Beneficiary of the Financial Liberalization - Essay Example Financial liberalization involves reduction of regulations and involvement of regulatory agencies in the financial system of a given country or region. It refers to the ‘deregulation of domestic financial markets and the liberalization of the capital account’ (Ranciere, Tornell & Westermann, n.d, p.1). The financial system broadly refers to the lending system in a given country and includes the players like banking institutions, the central bank, the treasury in a country, or the money markets authorities. Financial liberalizations will have varying effects on the players in different industries at the national, regional, or international levels. While some economies may suffer the negative consequences of financial liberalizations, other players in the economy will benefit from the initiative. This paper focuses on the likely beneficiary/beneficiaries of financial liberalization. Some financial reforms Financial liberalization measures can comprise both internal regulat ions (imposed by the central banks within a country) and external regulations effected by the regional and international agencies or the regulatory agencies in foreign countries. Internal FL measures are many. ... ludes a state’s withdrawal from involvement in financial intermediation (Ghosh, 2005), which is characterized by the transformation of development banks into regular financial institutions and privatization of publicly owned banking system. Financial liberalization also involves creating a relaxed environment for investors and firms to participate in the stock market through dilution of the listing conditions as well as relaxed regulation on the financial instruments to be used or acquired within a given financial system (Ghosh, 2005). A liberalized economy will also be characterized by better access to financial sources. Thus, internal financial liberalization also includes improving access to funds by the financial agents and firms and removing regulations on the kind of investments that can be made by these financial agents (Ghosh, 2005). External financial liberalization may include steps like allowing foreigners to own domestic financial assets, allowing domestic resident s to own foreign financial assets, or allowing free trade of foreign currency asset within the domestic economy (Ghosh, 2005). Who gains from financial liberalisation? Financial liberalization has positive and negative impacts on the economic development in a given country. While it can promote financial deepening and increased economic growth of a country, it can also lead to financial crisis in other countries resulting from increased macroeconomic volatility and excessive risk taking (Ranciere, Tornell, & Westermann, N.d). Financial repression, caused by governments’ interventions in the financial sector, leads to low economic growth and poor allocation efficiency in countries with negative interest rates and vice versa for positive interest rates (Caprio, Honohan & Stiglitz, 2006, p.5).

Comparison of two medieval theocracies Essay Example | Topics and Well Written Essays - 1250 words

Comparison of two medieval theocracies - Essay Example Yet though both cultures developed theocratic systems of government during the medieval period, we will see that they came to that system of government through very different means and enacted quite different measures to secure and maintain that system. First, though, we should consider the nature of theocracy itself. In a theocratic government, religion forms the basis for political decisions. Government leadership and religious leadership are synonymous, since faith in the governing religion is a prerequisite to political power. Religious texts and tenets provide the backbone for civil law and government. Those members of a theocratic society who do not espouse the prevailing faith may be disenfranchised at best and persecuted at worst. Such was the case when Christianity became the prevailing religion in Western Europe during the Middle Ages — an ironic development since Christians themselves had been a persecuted class in the Roman Empire from the time of Nero (54-68) until the emperor Constantine was converted to Christianity in the early 300s (Tierney). The dramatic power shift led to the most significant power struggle of the medieval period in Europe: the uneasy problem of church and state. Constantine had brought the church to a position of previously unimagined power, but in return, he expected the unwavering alliance of the church — in matters of faith as well as matters of government, as the great debate over the Arian and Nicene faiths in the 300s demonstrated. The challenge was that Christianity had to win over strong, existing systems of government and people whose religious were as sophisticated and compelling (and sometimes more fun) than Christianity. How could a theocracy come to bear in a system of existing governments? The church was inventive — it assimilated pagan traditions to make its asceticism more