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Analyzing financial development and investment in Turkey between 1960 and 2008, this paper illustrates how financial development affects investment decisions in a dynamic model of the firm under financial frictions. A composite index is constructed of three alternative financial development measures. The bounds testing approach was used to test for the existence of long-run levels relationships and long-run levels relationships were estimated using the autoregressive distributed lag method. Both short- and long-run causality tests were performed. Results indicate that financial development, budget balance, and total credit to the private sector positively and significantly affect investment.

This article empirically examines the relationship between alternative measures of financial development and the unemployment rate in a selected group of ten EU countries. Using annual data for the sample period of 1991–2012, we first perform different panel regressions (using averaged and non-averaged versions of data) for unemployment rate. These panel regressions are based on a regression equation that includes inflation rate and growth rate of GDP, in addition to the level of financial development, as explanatory variables. Secondly, we apply Granger causality tests to investigate the nature of the causality between financial development and the unemployment rate for each country in our sample. The empirical findings suggest that unemployment rate and financial development are negatively correlated, and there is a statistically significant causal effect of financial development on unemployment in certain countries. However, the results are not robust to the choice of proxy measure for financial development.

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The main aim of this study is to empirically analyse and answer the following two questions with regard to a sample of ten Central and Eastern European countries: (a) Is the unemployment rate associated with (or related to) the relative GDP (gross domestic product) share of the agriculture (measured as the agriculture value added percentage of GDP) for the average country in our sample? and (b) Is there a (statistically significant) casual effect of the relative GDP share of agriculture on the unemployment rate in each country? We believe that answering these two questions may provide new insights for the policy makers of these countries in relation to the possible linkages between the rate of unemployment and policies regarding the sectoral allocation of resources in general and agricultural policies in particular. Moreover, recent findings concerning the growing relative importance of certain countries as producers of agricultural innovations through investment in research and development suggest that a fresh emphasis on investigating the role that agriculture can play in solving structural problems (such as unemployment), particularly in the Central and Eastern European countries, can be more than justified (Pardey et al. 2013).Most of the prior literature investigating the relationship between the agricultural sector and the overall macroeconomic performance of a country has focused on the relationship between economic growth and the growth of agricultural output (or sometimes agricultural exports). As stated above, the present study attempts to add to the existing literature by examining the nature of the relationship between the relative GDP share of agriculture and the unemployment rate in selected high income and middle (upper) Abstract: Th e study empirically investigates the relationship between the relative GDP share of agriculture and the unemployment rate in a sample of ten Central and Eastern European countries. Utilising the annual data for the sample period 1996-2013, the empirical analysis is carried out using the dynamic panel regression analysis and the Granger causality tests. Th e estimation results based on the alternative specifi cation of regression equations for the unemployment rate suggest that the unemployment rate is negatively related to the relative GDP share of agriculture. In addition, a similar eff ect has been obtained for some other explanatory variables we have included in the unemployment equation as controlling variables: higher investment rate and trade openness are likely to lower the rate of unemployment. Th e fi nancial development has also been found to be negatively related to the unemployment rate, although the statistical signifi cance of its eff ect depends on the estimation technique used. On the other hand, the GDP growth and the government consumption have been found to be insignifi cantly related to the unemployment rate. While the Granger causality tests performed for each country produced evidence of a causal eff ect of the relative GDP share of agriculture...