Effects of Financial Globalization on Developing Countries

This short article summarizes a recent IMF paper on the subject with the same title, which is a part of the IMF’s ongoing research program on globalization. The long version was published as IMF Occasional Paper 220. The main purpose of the paper is to provide an assessment of empirical evidence on the effects of financial globalization for developing economies. The paper focuses on three related questions: (i) does financial globalization promote economic growth in developing countries? (ii) what is its impact on macroeconomic volatility in these countries? (iii) what are the factors that appear to help harness the benefits of financial globalization?