INTERNATION FINANCIAL MARKETS Essay Example | Topics and Well Written Essays - 2500 words

INTERNATION FINANCIAL MARKETS - Essay Examplenternational financial markets would lead to improvement in the economies of developing, less developed countries, and it would automatically enhance stability among developed countries. The major benefit accruing from international financial markets is more financial interconnection among different nations of world. It clear also lead to a deeper integration of developing economies with the international financial markets. Especially the developing economies would be able to revamp and develop their financial musical arrangement with the introduction of more complete, deeper, stable and better-regulated internal financial markets because of their affiliation to international financial markets. Levine, (2001) suggests a better functioning financial system with more recognise is likely to lead to faster economic growth.Apart from direct growth benefits, development of international financial markets is likely to result in other related benefits like promotion of the development of domestic financial sector and imposing disciplines on the macroeconomic policies of the governments. It also leads to generation of more efficiency by encouraging competition and results in enhanced corporate governance and functioning of better governments. Since these benefits occur over a longer period, it is usual that the costs of globalization ar detected more easily. The collateral long-term benefits of international financial markets can be traced through equity inflow and increased foreign direct investments into the domestic financial markets. However, it is difficult to identify the benefits of international financial markets, which enhance the productivity through empirical studies. An analysis of structural, institutional and macroeconomic policies across the country jumper lead to growth of GDP or productivity would prove the benefits resulting from international financial markets. At the micro level, the positive impac t of international financial markets can be felt in the capital account