Bankacılık Sektöründe Finansal İnovasyonun Bölgelerin Büyümesine Etkileri

Abstract

The study focuses on the relationship between financial development and growth through the effects of financial innovation in the banking sector, which plays an important role in financial markets. Banks have been forced to focus on technology-based innovative products and services in parallel with rapid technological developments and increased competition due to globalization. In this context, the paper aims to set out in detail the relationship between financial innovations in the banking sector and regional economic growth in Turkey. With the help of Principal Component Analysis, a new innovation index is developed by incorporating the fewest number of relevant variables among the abundance of innovation variables used previously. Annual data for the period of 1998-2017 is used for the analyses. ARDL Cointegration Test is applied after Generalized Dickey Fuller Unit Root test for each variable. In the analysis conducted for Turkey's regions, Arellano-Bond GMM first difference estimation method, Arellono and Bover / Blundell and Bond's Two Stage System GMM with Pooled Data are applied for the period of 2007-2017. The results indicate that the technological developments in the banking sector in some regions offer a positive contribution to the Turkish economy. This result supports Schumpeter's view and endogenous growth theories.

The Relationship of Financial Innovation and Economic Growth: Turkey Case

“…stated that positive changes in financial innovation are positively associated with economic growth in the long run, and financial innovation boosts economic growth in the long term; the authors also revealed that financial innovation will affect economic growth in the long term by promoting financial service expansion, financial efficiency, capital accumulation, and efficient financial intermediation, which are necessary for sustainable economic growth Bernier and Plouffe (2019). indicated a positive net relationship between financial innovation and gross capital formation, and the positive effect of financial innovation on economic growth by means of capital formation Karaçoban, Saltık, and Değirmen (2019). revealed technological developments in the banking sector, globalization, and innovation-based products and services, which were led by knowledge and provided affirmative and positive contributions to the economy in some regions and provinces of Turkey Chukwunulu (2019).…”