Study On The Impact Of Capital Account Opening On High-Quality Economic Development

The development experience of most countries shows that capital account opening can inject new impetus into the economic development of open countries and promote their economic growth through various channels,such as improving the institutional environment,broadening financing channels and optimizing capital allocation.However,the opening up of the capital account in some countries has led to frequent domestic financial risks and sharp economic fluctuations,which have affected long-term growth and development.How the opening of capital account affects the quality of a country’s economic development has become the focus of theoretical and practical circles.How to steadily promote the opening of the capital account to better serve the improvement of the quality of China’s economic growth is also a question worth studying.Based on the open capital account classification database constructed by Fernandez et al.(2019),this paper uses the systematic GMM model and the linear threshold regression model to empirically analyze the relationship between the overall opening of the capital account and the opening of its sub-items and the quality of economic development in 46 countries(regions)during 2002-2019.First,the linear threshold regression model is used to study the threshold relationship between the capital account opening and the quality of economic development with the per capita output level,financial development degree and institutional quality as the threshold variables.Considering that there may be multiple thresholds in practice at the same time,and the empirical analysis of only one threshold variable will cause internal logical contradiction,this paper further adopts the linear combination threshold regression model,and constructs the macroeconomic composite index of three threshold variables based on the entropy method,to further test the threshold relationship between the capital account opening and the quality of economic development.The results show that:(1)the overall opening of capital account and its sub-opening have significant threshold effect on the per capita output level and institutional quality.When the per capita output level and institutional quality of a country are low,capital account opening is not conducive to improving the quality of economic development.When the per capita output level and institutional quality exceed the corresponding threshold value,the implementation of corresponding capital account opening will significantly promote the improvement of the economic development quality of the open country.(2)There is heterogeneity in the capital of each sub-project: the opening thresholds of foreign direct investment and equity investment are relatively low,so they can be opened earlier;And the financial credit opening threshold is relatively high,should be opened when the national financial market is more mature.(3)In view of China’s own situation,the overall macroeconomic performance of China is good at present,and the per capita output level and institutional quality have passed or are relatively close to the corresponding threshold value of capital account opening.We should continue to promote the opening of capital account and intensify the opening,so as to maximize the benefits of capital account opening to improve the quality of economic development in China.