Stage Of Economic Development Research Articles

The characteristics of the new dual-cycle development pattern and systemic financial risk based on TVP-SVAR and MS-VAR model analyses

The new development pattern of the dual cycle is an important strategic deployment by the Chinese government in response to the complex and changing economic environment and a new stage of economic development. Based on the perspective of this new dual-cycle development pattern, this paper explores the time-varying nonlinear relationship between this new development pattern and systemic financial risk by constructing two models: the TVP-SVAR-SV and the MS-VAR. The empirical results show that, first, there was a significant negative impulse response effect between the new dual-cycle development pattern and systemic financial risk. The inhibitory effects of the domestic cycle and short-term pulse response were more significant than those of the international cycle and medium- and long-term pulse responses. In addition, the inhibitory effect of the new dual-cycle development pattern on systemic financial risk exerted different impact effects at different timepoints, with significant variability. Second, there was a significant nonlinear relationship between the new development pattern and systemic financial risk. The MSIH(2)-VAR(1) model identified two regional states: the financial risk release stage and the financial risk accumulation stage. This effect lasted longer in zone 2 (financial risk accumulation phase), with a sample size of more than 60% of the total sample and a duration of 6.12. Third, in the impulse response analysis of different zones, a mutually reinforcing effect was found between the domestic and international cycles, and both exerted a significant suppressive effect on systemic financial risk, which was more significant in zone 1. The findings of this paper have important theoretical and practical significance for constructing and perfecting the new dual-cycle development pattern, promoting the high-quality development of China's financial market, and preventing the accumulation and occurrence of systemic financial risk.

Financial inclusion and threshold effects in carbon emissions

Although financial inclusion would induce greater pollutant emissions through economic activity, improved access to financial services may facilitate investment in clean technologies. This study investigates whether financial inclusion has influenced the dynamics of carbon dioxide (CO2) emissions over the last decade using a sample of 70 countries. We implement panel threshold techniques to explore possible regime shifts in environmental quality. Our results reveal that the influence of increased financial access on air pollution depends on the economic development stage. While financial inclusion can increase CO2 emissions in lower-income regimes, environmental quality appears to be enhanced, with more inclusiveness at later developmental stages. Less-developed countries require more robust environmental policies to align their financial inclusion initiatives with sustainable economic development.

Impact of the digital economy on carbon dioxide emissions in resource-based cities

With the rapid development of the digital economy, its environmental impact, particularly on carbon dioxide emissions in resource-based cities, has emerged as a vital research topic. Resource-based cities, often central to traditional industries, are confronted with the dual challenges of environmental pollution and economic transformation. This study employs empirical analysis to examine the influence of the digital economy on carbon dioxide emissions in these cities. The findings reveal that the digital economy significantly reduces carbon dioxide emissions, with this impact being more pronounced in the early stages of digital economic development and gradually diminishing thereafter. In the mechanism analysis, we found that the digital economy can reduce carbon dioxide emissions in resource-based cities by raising public concern about the environment. Moreover, the study highlights significant variations in carbon reduction effects among different types of resource-based cities, noting that stronger environmental regulations further enhance these effects. These insights not only provide a new theoretical perspective but also offer practical guidance for policymakers in promoting sustainable development within the digital economy.

CONTEMPORARY STATISTICAL TRENDS OF FOREIGN TRADE BY SEA TRANSPORT BY COUNTRY GROUPS

Nino Abesadze E-mail: nino.abesadze@tsu.ge Associate Professor, Ivane Javakhishvili Tbilisis State University Tbilisi, Georgia https://orcid.org/0000-0002-6564-2771 Otar Abesadze E-mail: o.abesadze@gmail.com Associate Professor, Georgian National University SEU Tbilisi, Georgia https://orcid.org/0000-0003-1644-4995 Nino Paresashvili E-mail: nino.paresashvili@tsu.ge Associate Professor, Ivane Javakhishvili Tbilisis State university Tbilisi, Georgia https://orcid.org/0000-0001-7645-6491 Natalia Robitashvili E-mail: nato.robitashvili@bsu.edu.ge Associate Professor, Batumi Shota Rustaveli State University Batumi, Georgia https://orcid.org/0000-0001-7645-6491 Abstract. At the modern stage of economic development, under the conditions of deepening globalization, the use of correct logistics is becoming more and more relevant, which plays an important role in the development of trade relations between countries and ensuring correct fragmentation of the economy. Today, the situation is such that the presence of certain threats in sea transportation determines the high risk of the possibility of an increase in transportation prices, which is why its influence on price volatility is quite strong. Based on the current situation, the research of maritime logistics issues is becoming more and more relevant in this regard, because the analysis of quantitative indicators of shipments, determination of risk expectations, detection of trends, identification of problems, etc. is an indicator of increasing the effectiveness of maritime logistics. This issue becomes even more important when the issue concerns the activation of trade relations with groups of different countries of the world by sea transport. This process is actively taking place in Georgia today, which is a prerequisite for diversification of transportation by different types of transport and increasing its intensity in the future, and there are signs of this in the country. As of today, the geographical area of trade relations of Georgia in terms of types of transport is wide, although the quantitative characteristics of foreign trade are differentiated according to individual countries and groups of countries. The main goal of the paper was to identify and analyze the statistical trends of Georgia's foreign trade relations with EU, CIS, BSEC, OECD, GUAM, and EFTA countries. During the stages of statistical research, the methods of statistical observation, gathering-grouping, and analysis are used in the research process. Therefore, the article discusses studies and analyzes the dynamics of foreign trade relations of Georgia with EU, CIS, BSEC, OECD, GUAM, and EFTA countries groups by sea transport. The main statistical indicators of foreign trade turnover, export-import, local export re-export, and the characteristics of the commodity structure are analyzed according to all indicators. The main statistical trends of foreign trade with non-specified country groups are identified and regularities are established. Relevant conclusions are made. Conclusions. Foreign trade relations in Georgia are primarily carried out by road transport, although marine transport with a 32.6% share firmly occupies the second place in dynamics;In exports, the advantage of the use of road transport is evident, compared to imports. EU, CIS, BSEC, OECD, GUAM, EFTA countries, the rate of foreign trade by sea transport is increasing;In 2016-2023, on average, the share of the EU in foreign trade by country groups increased by 5.3%.Changing trends are observed in case of exports of EU, BSEC, OECD countries groups. From 2019, the predominant growth of the BSEC indicator was revealed, but in 2023, the EU was again the highest indicator with a share of 67.4%9 in export relations.In the case of imports to the EU, CIS, BSEC, OECD, GUAM, EFTA countries, there is a pronounced trend: the European Union is the undisputed leader in the group of mentioned countries. In 2016-2023, the EU's share of maritime transport imports grew by an average of 2.6% annually. The growth of EU indicators is recorded in local exports, while a completely different picture was revealed in re-exports of sea transport, due to the intensification of trade relations with the CIS countries.From these EU, CIS, BSEC, OECD, GUAM, EFTA countries, Motor cars, Petroleum and petroleum oils are the most imported to Georgia, the share of which in imports is 68% and 32%. Copper ores and concentrates are the most exported, whose share in the motor exports of EU, CIS, BSEC, OECD, GUAM, EFTA is 38% and 17%. No significant changes have been observed in the commodity structure of both exports and imports in recent years. Key words: Trends, Sea Transport, Export, Import, Country Groups. JEL classification: C0

The living conditions of foreign workers: a field study in Erbil city.

The Kurdistan Region is in the stage of economic development in various sectors, and sometimes economic development requires labor. Allowing and bringing foreign labor depends partly on how much the local labor fulfills the needs of the Kurdistan Region, bringing foreign workers sometimes is discussed as critical by the authorities, despite the lack of employment and local labor, but it is allowed to bring foreign labor, foreign workers have a number of social dimensions, which may affect their living conditions. This study aims to determine the living conditions of foreign workers in Erbil. The research method is quantitative method through the use of questionnaire tool, (381) foreign workers in male and female gender were taken as the study’s sample. Then analyzing the data with the use of the program (SPSS), we came to the conclusion that foreign workers in Erbil feel comfortable and safe, cultural differences have not become a problem and obstacle in front of them regarding religion and food, and they quickly adapt to the culture of Kurdistan Region. Foreign workers are more likely to have no social security and have been asked for inappropriate work, The male faces more social, psychological, healthy, economical, and legal problems than the female. Finally, some suggestion and recommendation have been presented to the related parties and the researches that will be done after this research.

Do local government investment preferences influence renewable energy technology innovation? Evidence from China

Local government investment can influence renewable energy technology innovation (RETI). Based on the panel data of 30 provinces in China from 2007 to 2019, this paper uses fixed effect models, partial linear generalized function coefficient models, and other methods to test the impact of local government investment preferences (LGIP) on RETI. The results are: (1) Productive investment preferences significantly inhibit RETI. (2) The impact of productive investment preferences on RETI is heterogeneous across economic development stages and regions. (3) With economic growth, the negative impact of productive investment preferences on RETI gradually decreases. The findings suggest that local governments should adjust investment patterns and appropriately reduce productive investment to improve RETI.

Reflections on appropriately liberalizing ART for groups requiring special attention in China.

The continuous advancement of assisted reproductive technologies (ART) and the evolving attitudes towards marriage and fertility among the general public have led to an increasing number of groups requiring special attention (GRSA) desiring to fulfill their reproductive needs through these technologies. These groups include single women (including single mothers without children), same-sex couples, and women in high-risk occupations, among others. The purpose of this paperis to explore the feasibility of appropriately liberalizing ART for GRSA. This paper discusses the advantages of a moderate liberalization of ART for GRSA from two perspectives: a theoretical basis and a practical significance level. It also analyzes the current constraints on liberalizing ART and presents suggestions for moderate liberalization. The moderate liberalizationof ARTcanprovidetechnical supportfor respecting and realizing the reproductive freedom of GRSA, which has certain theoretical and practical significance. However, itis also subject toconstraints. We call for government to keep pace with the times, based on the current stage of political, economic, and social development, to further recognize and protect citizens' reproductive rights, prioritize the practical needs of the public, and explore policies and regulations for gradually loosening the restrictions on ART for GRSA.

Stakeholders’ Participation in the Creative Economic Development of Cirebon City

This study aims to examine the participation level of stakeholders, identify the dominant stakeholders, and investigate the factors inhibiting stakeholders’ participation in the planning, implementation, and evaluation of creative economic development in Cirebon City. “Creative City” is politically and legally stipulated as the city vision in the regional mid-term development plan 2018-2023 of Cirebon City. As the creative economy is centered around the production, exchanges, and consumption of goods and services from human creativity, Cirebon City is, therefore, a significant case study to investigate how the local government implements participatory processes in developing a creative city.Using qualitative methods, data were collected through a semi-guided interview of 190 respondents from five stakeholders: academics, businesses, communities, government institutions, and media organizations. It was followed by a focus group discussion of 12 key respondents selected purposively from the five stakeholders. With primary and secondary data sources, qualitative data was analyzed through the process of data reduction, data display, and conclusion drawing/verification.This study concluded that stakeholders' participation in all stages of creative economic development in Cirebon was still minimal. The businesses in culinary subsectors as the most dominant stakeholders in the participation processes. The lack of socialization from the municipal government and the limited collaboration amongst the stakeholders were identified as the inhibiting factors of inclusive participation in creative city development. The government needs to accelerate creative economic development through multisectoral policies, including improvement of business knowledge and skills of the local business actors, goods and services’ quality upgrading and assurance, certification and legal assistance, as well as promotion and market expansion

Study on the Impact of China's Digital Economy on Agricultural Carbon Emissions

<p _msthash="770" _msttexthash="18511649104"><span lang="EN-US" style="font-size:12.0pt"><span style="font-family:"Times New Roman",serif">Under the background of China's “double carbon” goal, digital economy has become an important way to reduce carbon emissions in China. This paper utilizes the provincial panel data of China from 2012 to 2022, introduces the perspective of agricultural science and technology innovation, empirically examines the impact mechanism of regional digital economy development on agricultural carbon emission through regression analysis model, and portrays the dynamic effect and spillover effect of digital economy development on agricultural carbon emission from both time and space dimensions. The empirical results show that: digital economic development will have a significant inhibitory effect on the intensity of agricultural carbon emissions, and the inhibitory effect will be indirectly affected through the path of agricultural scientific and technological innovation; the impact of digital economic development on the intensity of agricultural carbon emissions there is a time lag effect, the current stage of the digital economic development will still have a strong inhibitory effect on the intensity of agricultural carbon emissions in the future; Digital economic development has a spatial spillover effect, i.e., the development of the regional digital economy will have an inhibitory effect on the intensity of agricultural carbon emissions in neighboring provinces. Based on this, it is proposed to strengthen the construction of digital infrastructure, promote the coordinated development of the digital economy in the region, and formulate policies to reduce carbon emissions in agriculture.</span></span></p>

On the issue of determining effectiveness and the quality of corporate financial management: theoretical and conceptual aspects

The current stage of economic development is characterized by such features as a high degree of uncertainty in external and internal environmental factors, a high level of competition, and the strengthening of the role of effective financial management of companies. These features determine the need to apply the theory and practice of corporate financial management, its modern tools to assess the effectiveness and quality of the company's financial management, which, in turn, contributes to the adoption by the company's management of sound management decisions necessary to achieve the strategic goals of its development.

Energy Transition and Poverty Alleviation in Light of Environmental and Economic Challenges: A Comparative Study in China and the European Union Region

This study aims to compare the effectiveness of renewable energy and circular economy practices in reducing environmental damage and poverty in China and the European Union (EU) by using the Autoregressive Distributed Lag (ARDL) approach and the Vector Error Correction Model (VECM) technique. Analyzing data from 1995 to 2022, we compared the effectiveness of these approaches in both regions. This study offers several fresh perspectives on the fight against environmental damage and poverty, differentiating itself from existing research in a few key ways. In fact, most studies focus on a single region’s approach to sustainability. However, this research directly compares China and the European Union (EU), highlighting how factors like economic structure and development stages influence the effectiveness of renewable energy and circular economy practices. Also, this study shows how renewable energy and circular practices can simultaneously tackle both environmental damage (emissions) and social issues (poverty). Our findings reveal that factors like poverty, fossil fuel reliance, economic growth, and international trade all contribute to rising carbon emissions in both China and the EU, though their influence varies. Interestingly, China experienced greater success in curbing emissions through solar power, circular economy measures, and wind power compared to the EU. Additionally, the impact of these strategies on poverty reduction differed significantly between the two regions. Based on these results, we recommend that policy makers in both regions develop tailored strategies for tackling carbon emissions and poverty. Prioritizing renewable energy sources and circular practices is key, as they can simultaneously reduce emissions and alleviate poverty. However, it is crucial to focus on approaches that work best in each specific region, considering social, economic, and environmental factors. This study suggests that a one-size-fits-all approach will not work for fighting climate change and poverty. While renewable energy and circular economies are effective, China saw greater success with solar and wind power compared to the EU. Policy makers need to design strategies specific to their region’s economic, social, and environmental context. Further research can refine these approaches, and public education is crucial to promote sustainable behavior and empower policy makers. It is also needed to refine and improve the implementation of these strategies. Finally, public awareness and education are essential to promote sustainable behavior and empower policy makers in their fight against climate change and poverty. This study highlights the importance of a region-specific approach to energy transition and poverty alleviation. By comparing China and the EU, we gain valuable insights into the effectiveness of different strategies in tackling these interconnected challenges. The findings provide valuable guidance for policy makers looking to create a more sustainable and equitable future.

An inquiry into the drivers of an entrepreneurial economy: A Bayesian clustering approach

AbstractUnderstanding the worldwide drivers of qualified entrepreneurship is a key issue in economic policy design. To help policy decisions exert their intended impact, we aim to cluster a wide range of countries on the basis of their levels and trends in self-employment productivity using a finite mixture model applied to a new large dataset of 121 countries covering the period of 1991–2019. Our results point to three groups of high-, medium-, and low-productive means and tendencies, the geographical distribution of which suggests that they can be reinterpreted using the three stages of economic development, namely, innovation-, efficiency-, and factor-driven economies. Notably, we find that widespread digitalization and low unemployment enhance the probability of transitioning into a highly productive cluster. However, we failed to find that industry weight or employment protection legislation strictness serve as determinants in the transition between groups. Suggestive rationales for these results and implications for the entrepreneurship policy agenda are also provided.

Impact of environmental, energy and business efficiency on [formula omitted] emissions: A composite indicator for emerging Asia-Pacific markets

Environmental, energy, business and development dynamics have received strong research interest. However, previous studies have mainly explored these topics separately. Conversely, we study these aspects jointly, constructing a composite indicator and assessing resulting impact on several SDGs domains. The aim of the analysis is to discover the importance of latent aspects in explaning the environmental, energy and business efficiency for specific countries. Estimating this multidimensional efficiency is relevant for the identification of the conditions for the achievement of CO2 containment and sustainable development progress. We make use of the World Bank's World Development Indicators (WB WDI) for selected emerging countries from the Asia-Pacific region ranging from lower-middle-income to upper-middle-income economies, following the WB Group country classifications by income level. We build a composite indicator for eliciting diverse dimensions related to the environment, energy policy and economic factors. The first steps of the indicators analysis are achieved by the combination of the DEA and Tobit analyses. Therefore, we examine the environmental, energy and business efficiency according to the economic development stage of the analysed countries, making use of an entropy index. The index’ robustness is tested at both stages – first, exploring the Tobit analysis, therefore, by inspecting an additional Asia-Pacific country having a different income with respect to the benchmark. The results suggest the creation of country clusters. Above all, China outstands in terms of environmental efficiency and R&D, as a result of a broader energy development strategic plan in the last few decades.

The impact of cleaner energy sources, advanced technology firms, and economic expansion on ecological footprints is critical in sustainable development

The environmental degradation accompanying economic growth, despite the potential mitigating effects of technological advancements and cleaner energy sources. This study examines the critical impact of cleaner energy sources, advanced technology firms, and economic expansion on ecological footprints within the context of sustainable development, focusing on the period between 2010 and 2022. By comparing the E7 (emerging seven) and G7 (Group of Seven) economies, the research aims to delineate how these factors collectively influence environmental sustainability in both developing and developed nations. Utilizing a robust panel estimation technique, the study systematically explores the relationship between the adoption of renewable energy technologies, the growth of high-tech industries, and macroeconomic expansion, alongside their respective effects on the ecological footprint, a key indicator of environmental impact. Our statistical analysis reveals significant differences between the E7 and G7 countries. For the G7, investments in cleaner energy and technology sectors have shown a more pronounced effect in reducing ecological footprints, attributed to higher efficiency standards and greater public awareness. In contrast, the E7 countries exhibit a delayed response, owing to varying stages of economic development and technological adoption, although promising trends are emerging. Notably, the G7 demonstrates a more pronounced inclination towards financial imperialism (0.043), while the E7 is significantly influenced by green energy sources (0.258). Policy implications drawn from the findings suggest that targeted investments in green technologies and renewable energy sources, coupled with robust policies supporting economic expansion in a sustainable manner, are crucial for both groups of countries. For the E7, accelerating technology transfer and adopting stricter environmental regulations are key, while the G7 should focus on innovation and the continuous improvement of energy efficiency standards. This dual approach is essential for mitigating the environmental impacts of economic growth and steering the global economy towards a more sustainable trajectory.

Research on urban agglomeration spatial network structure in the middle reaches of the Yangtze River based on real-time traffic accessibility scenario analysis

ABSTRACT Investigating the spatial network structure of urban agglomerations based on traffic accessibility has an important practical significance in accelerating the process of regional integration. Taking urban agglomeration in the middle reaches of the Yangtze River (UAMRYR) as the case study, this study aims to examine the characteristics associated with the spatial network structure based on traffic accessibility and its changes under scenarios of different traffic accessibilities by adopting real-time traffic data, modified gravity model, and social network analysis (SNA). The main conclusions are as follows. Wuhan, Changsha, and Nanchang are the central cities in the spatial network; the spatial network structure of UAMRYR is imbalanced and in the agglomeration stage of regional economic development. With the development of traffic accessibility, resources first gather in the individual center cities and then spread to other cities, and the network tends toward equilibrium.

Australian innovative activity and international technology, 1854–2016

Abstract Has Australia’s focus as a producer and exporter of natural resources—often considered low technology industries—constrained the development of its innovation system? We exploit a new digital database from the Commonwealth Patent Office to investigate this question. We find that the focus of domestic innovativeness supported key industries for Australian development and complemented technological specialization by foreign patent applicants, particularly in European and American manufacturing. The results support the argument that shifts in national technological orientation is a relatively long game and that technical advantage is shaped by a nation’s stage of economic development.

ІННОВАЦІЙНІСТЬ ТА ПЕРЕДОВІ ТЕХНОЛОГІЇ В УКРАЇНІ ТА КРАЇНАХ СВІТУ

The article examines the leading indicators of socio-economic development of individual countries, including the share of GDP of individual countries in the world GDP, the share of the country's population in the world population, GDP per capita, and expenditures on R&D. It was determined that a larger share of GDP per capita allows for an increase in gross domestic spending on R&D, % of GDP. Ukraine has the lowest gross domestic expenditure on R&D compared to the analyzed countries, only 0.29% of GDP. While for China, this indicator is equal to 2.433%, for Hungary – 1.642%, and for Germany – 3.129%. A comparison of the position of Ukraine according to the components of the Global Innovation Index, which corresponded to other countries at different stages of economic development, made it possible to obtain the following results. First, Ukraine needs to catch up in all components with developed countries. Second, Ukraine can compete on the components of the innovation index with some newly industrialized nations, such as Mexico and South Africa. Third, Ukraine dominates the least developed countries in the components of the Global Innovation Index. Also, we analyzed the opportunities for frontier technologies in Ukraine and other countries. According to this index, Ukraine ranks 58th among 166 countries surveyed. The five countries, including the United States of America, Sweden, Singapore, Switzerland, and the Netherlands, are leaders. China took 35th place. According to the components of this index, Ukraine already has a good position in terms of information and communication technologies and skills – however, R&D, industry, and finance remain weaknesses. So, during the study, "bottlenecks" were identified. Insufficient support for R&D and low costs restrain the innovative development of Ukraine.

Evaluating the Kuznets curve relationship between economic growth and child labor in an emerging economy

PurposeThis study aims to test the Kuznets curve between economic growth and child labor, along with the influence of exports, household size and rural population in the context of Pakistan.Design/methodology/approachTo achieve the research objective, this study applied the unit root test, bound co-integration test, and autoregressive distributive lags (ARDL) method for the period of 1972–2021.FindingsThe findings show an inverted U-shaped relationship between economic growth and child labor indicating that at the beginning stage of economic development, child labor increases due to lower per capita household and subsequently, in the long-run of economic development, child labor decreases due to the higher per capita households. Moreover, the results also show that exports, household size and rural population have a positive influence on increasing child labor.Research limitations/implicationsThe policymakers and government of Pakistan need to focus on long-term economic growth policies, ensure free quality education and cheap equipment which practices minimum manpower to reduce the threat of child labor.Social implicationsHaving long-run economic growth, the government of Pakistan need to equally benefit the households and the poor population to reduce child labor and enhance the social welfare of society.Originality/valueTo the best of the authors’ knowledge, this is the first study that investigates the Kuznets curve relationship between economic growth and child labor in the context of Pakistan. Moreover, this study contributes to the reduction in child labor through long-term economic growth in the context of Pakistan.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-05-2023-0387

Unveiling Transportation Socio-Economic Adaptability Using a Node–Place Model: A Case from Zhejiang Province, China

Effective investment in transportation infrastructure ensures sustainable urban development and high-quality economic development. Understanding transportation and socioeconomic relationships is crucial for developing investment strategies. Existing research focuses on analyzing the contribution of transportation to the economy or the contribution of economic development to transportation, neglecting the identification of transportation infrastructure weaknesses to initiate targeted investment and construction. In this study, we propose an assessment framework based on the node–place model to identify the shortcomings in transportation infrastructure. The framework encompasses the adaptability of the current transportation infrastructure and the stage of economic development, evaluating whether the current transportation infrastructure is ahead of or lagging behind the level of economic development. We conduct a case study on three kinds of transportation infrastructure, including railways, highways, and civil aviation, in Zhejiang Province, China. The results show that Zhejiang Province’s transportation infrastructure generally meets economic development requirements, and most cities have relatively advanced transportation systems. However, significant gaps in transportation facilities in certain areas still need to be targeted and supplemented. These findings help to explore the theoretical relationship between transportation and socioeconomics, providing a basis for economic investment decisions on transportation infrastructure.

How consistent are measures of financial liberalization in assessing its impact on bank cost efficiency? A cross–country empirical analysis

AbstractUsing a sample of commercial bank–year observations covering 104 countries over the 1999–2017 period, we consider five contemporary de jure and de facto indicators of financial liberalization to provide a comparative assessment of their impact on bank cost efficiency. With the sole exception of one de jure index, all other financial liberalization measures consistently indicate an improvement in cost efficiency. We also compare the effects before and after the 2007 global financial crisis, which instigated a policy shift from deregulation to prudential re–regulation. We find that prudential re–regulation did not detrimentally affect bank cost efficiency. Our results for the main financial liberalization measures hold irrespective of countries’ stage of economic development and prove robust to re–estimations based on a single-country efficiency frontier for the US, alternative model specifications and methodologies that account for endogeneity and cross section dependence. The key policy implication from our findings is that prudential policies aimed at fostering stability and less bank risk–taking, can be pursued without any risks of hindering financial intermediation and lowering bank cost efficiency.