No abstract

The aim of the paper is to study finance-economic growth nexus in Poland using a time series approach. We find evidence of the existence of the finance-economic growth link in Poland. Most empirical studies do not consider the lending structure of the financial sector (share of households’ vs firms in total credits). The obtained results show that when using the share of households and companies in total credits, the long run empirical relationship in VECM is statistically significant and larger. Empirical studies using total private credit share in the GDP or the value/volume of total credits tend to undervalue the impact of financial development on economic growth. In the case of Poland, empirical evidence that supports this hypothesis was found, and therefore policymakers and researchers should take bank lending structure into account. Furthermore, the study shows that financial series may possibly have long memory properties and that researching the financial development-growth nexus could require using fractional integration methods. The reported evidence suggests financial development plays a significant role in both economic growth and credit growth. Due to data limitation, this study focuses on a single country case – Poland with the need for further research (larger sample).

Financial and economic crises repeat themselves at indefinite intervals. As in the Great Recession (also known as Subprime Crisis) of 2007/2008 there was a bundle of events and processes that preceded it and contributed to its emergence, whether it be economic, political, or ideological. Based on observations presented in this paper, explanations are suggested that crises are significantly related to the development of various indicators. Relevant indicators include the impact of economic indicators (e.g., GDP, key interest rates, debt ratios), capital markets and - as the current Corona Crisis shows - supposedly unforeseen factors or shocks. The study deals with a comparative analysis of indicators regarding both crises and the Great Depression, with the aim of identifying possible trends or patterns. It uses a comparative method and reveals some significant similarities. This insight can be seen as a support for the birth of further crises. The work aims to provide a contribution to current crisis research in a comparative context and to advance findings in the field of early warning and crisis education.

New growth theories during the 1990s stress the importance of exploring a link between investments and growth. Using standard growth equations, we look into the correlation between investment in technical structure and growth in Croatia for two periods – socialist (1960–1989) and transition (1990–2009). Results suggest that equipment investments can boost growth rates through total factor productivity (TFP). This is consistent with the work of De Long and Summers (1991, 1992, 1993, 1994) and Temple (1998). In Croatia the equipment investments – growth link appears to be stronger than the structure investment – growth link for both periods. We also find a strong positive correlation between human capital and growth. Tests confirm the consistency and robustness of the regression results, suggesting inclusion of new variables in standard growth models. The structure of technical investments, real capital stock (not proxies) and estimated human capital stock (not schooling proxies) should have an important role in explaining international growth differences.

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