Democracy and Banking Stability: Is the Relationship U-Shaped?

Journal of the Knowledge Economy - Tập 14 - Trang 4426-4448 - 2022
Mohamed Sami Ben Ali1, Sami Ben Mim2
1College of Business & Economics, Qatar University, Doha, Qatar
2IHEC, LaREMFiQ, University of Sousse, Sousse, Tunisia

Tóm tắt

This study addresses the impact of democracy on the stability of the banking system for a sample of 114 countries over the period 2000–2017. Our findings offer strong evidence for a U-shaped relationship between democracy and banking stability. Results also show that the way democratic institutions impact banking stability is highly dependent on their ability to implement effective anti-corruption policies. Controlling for countries’ income levels reveals that not all high-income countries are necessarily enjoying the positive effects of democracy on banking stability.

Tài liệu tham khảo

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