چکیده:
The banking sector is one of the important financial intermediaries
in an economic system. Improvement in the banking sector can
achieve optimal allocation of financial resources. The performance
of banks and other financial service providers has direct effect on
economic growth. One of the factors that can affect the banks
operation is economic freedom. Economic freedom and freedom of
private property rights can influence the quality of financial
institutions such as banks. Using panel data model, this paper
attempts to study the effect of the economic freedom index on the
performance of banks in selected developed and developing
countries for the period 2001-2011. According to our finding,
countries with higher degree of economic freedom index have
better financial performance. Moreover, economic freedom
indexes have positive effects on bank′s profitability in both groups
of countries.
خلاصه ماشینی:
Using panel data model, this paper attempts to study the effect of the economic freedom index on the performance of banks in selected developed and developing countries for the period 2001-2011.
In fact, economic freedom might be an important factor that affects the participation of banks in economic activity and the quality of its performance through providing easier and more domestic efficient costs and cross-border transactions by facilitating the competitive environment and also by creating a secure market for trading.
Using a panel data model, this paper examines the impact of economic freedom on banks performance in selected developed1 and developing2 countries.
An index of economic freedom (including the size of government regulation on financial, labor and business market, sound money, legal structure and security of property rights and free international trade) is used as an explanatory variable in the model.
According to the Annual World Report of Economic Freedom, the index of economic freedom includes: 1) size of government index (expenditures, taxes and trading), 2) the legal structure and security of property rights index, 3) access to sound money index, 4) internationally trade index, and 5) regulation of finance, labor and business markets index.
Moreover, they found that free trade was more effective in increasing the profitability of Islamic banks in MENA countries than other indexes of economic freedom.
Using panel data model, this paper studies the effect of the economic freedom index on the performance of banks in selected developed and developing countries for the period 2001-2011.