Financial Development, Financial Structure, and the Growth Effect of Monetary Policy: International Evidence

Yong, Ma

doi:10.1080/1226508x.2018.1521297

Cited by 12 publications

(8 citation statements)

References 37 publications

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“…Several studies have confirmed that better financial development will lead to a more effective monetary policy transmission (Raddatz, 2006;Krause and Rioja, 2006). In contrast, other studies conclude that financial development decreases the impact of monetary policy shock on output (Ma and Lin, 2016;Ma, 2018). However, Ma (2018) highlighted that this condition occurs in the low stage of economic development.…”

Section: CII Spatial Econometrics Regression Resultsmentioning

confidence: 92%

“…There are some aspects which can be improved from the previous analysis. First, the preceding analysis on the effect of monetary policy shocks on real economic activity focused more on the response of real output or real output growth (Tan et al, 2010;Ridhwan et al, 2011;Sengupta, 2014;Ma, 2018;Goshit et al, 2020;Narayan et al 2009) instead of the output gap. Second, most of them concentrate on the national level analysis, which has common institutional, monetary, and fiscal regimes.…”

Section: Introductionmentioning

confidence: 99%

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Asymmetric Impacts of Monetary Policy Shock on Output Gap: Evidence From Regions in Indonesia

Triwibowo

Oktaviani

2022

bemp

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We examine the impact of the monetary policy on regional output gaps across 33 Indonesian provinces. Heterogeneous regional responses of the output gap to monetary policy shock are captured using the Vector Autoregressive model. Moreover, the idiosyncratic variations across provinces accounted for different responses are observed with the spatial econometric model. The spatial analysis suggests that economic structure and financial depth positively and significantly determine the aforesaid asymmetric responses. On the other hand, economic size and trade openness have a negative impact on them.

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Section: CII Spatial Econometrics Regression Resultsmentioning

confidence: 92%

Section: Introductionmentioning

confidence: 99%

Asymmetric Impacts of Monetary Policy Shock on Output Gap: Evidence From Regions in Indonesia

Triwibowo

Oktaviani

2022

bemp

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“…The growth effect of monetary policy in advanced economies is more pronounced due to a robust financial structure than in developing economies. It is most noticeable in the market-concentrated financial system compared to the bank- concentrated financial system [ 33 ]. [ 6 ] used the inflation rate as a monetary policy to check the effectiveness of the monetary policy.…”

Section: Literature Reviewmentioning

confidence: 99%

“…The literature on the relationship between financial inclusion and monetary policy effectiveness is still growing. Many kinds of research have attempted to examine the relationship in a single country [ 3 , 4 , 28 , 34 ] or a group of regional countries SAARC region [ 5 , 6 , 8 , 29 , 33 ].…”

Section: Literature Reviewmentioning

confidence: 99%

Financial inclusion and monetary policy effectiveness: A sustainable development approach of developed and under-developed countries

et al. 2021

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The study explores the causal relationship between monetary policy effectiveness and financial inclusion in developed and under-developed countries. Structural Vector Auto-regressive techniques have been inducted to explore the relationship between monetary policy effectiveness and financial inclusion. The study covers the secondary data of 10 developed and 30 underdeveloped countries throughout 2004–2018. It is concluded that monetary policy effectiveness and financial inclusion do not have a contemporaneous impact on each other. Nevertheless, the reduced-form Vector Auto-regressive witness the reverse causality between financial inclusion and monetary policy effectiveness in developed countries. Thus, effective monetary policy enhances financial inclusion in a country, and a higher degree of financial inclusion lowers the inflation rate and makes monetary policy effective. One way causality from monetary policy effectiveness to financial inclusion can be observed in under-developed countries. Using the Structural Vector auto-regressive technique and financial inclusion index composed of three-dimension to examine the relationship of monetary policy effectiveness and financial inclusion in developed and developing countries is considered the study’s significant contribution.

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“…gelişmişlik düzeyindeki reel ekonomilerin taleplerine göre oluşan optimal finansal yapıların varlığından bahseden Liu ve Zhang (2020), Çin'in 29 bölgesinde 1996-2013 yılları arasında finansal yapının ekonomik büyüme için önemini araştırmakta ve piyasaodaklı sistemin Çin için giderek daha önemli olmaya başladığını göstermektedir. Ma (2018) gelişmiş ve gelişmekte olan ülkeleri analiz eden çalışmasında ülkelerin ekonomik gelişmişlik düzeyleri arttıkça piyasa-odaklı finansal sistemlerin ekonomik büyümeyi banka-odaklı finansal hizmetlere nazaran daha fazla desteklediğini göstermektedir. Diğer yandan, Chu (2020) finansal yapı ve ekonomik büyüme arasındaki ilişkiyi incelediği çalışmasında, finansal sektör geliştikçe hisse senedi piyasalarının bankalara nazaran daha fazla güçlendiğini, ancak, bankacılık sektörünün zayıf olduğu ülkelerde hisse senedi piyasalarındaki büyümenin ekonomik büyümeye destek vermediğini savunmaktadır.…”

Section: Li̇teratür Taramasiunclassified

Fi̇nansal Si̇stemi̇n Yapisi İle Reel Ekonomi̇ Arasindaki̇ Di̇nami̇k Etki̇leşi̇m

Şendeniz-Yüncü

2020

Hacettepe Üniversitesi İktisadi Ve İdari Bilimler Fakültesi Dergisi

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In this study, structure of financial systems, optimal financial structures and their relationships with the real economy are examined in 23 emerging markets between 1980-2017, following the "new structuralism" view, in which optimal financial structures differ according to the economic development levels of the countries. Results of panel least squares and dynamic panel Generalized Method of Moments (GMM) estimators give evidence for the view that as economy of a country grows, financial system of that country becomes more market based. This study also documents that a deviation of a country's actual financial structure from the predicted optimal financial structure has a negative effect on the real economy. The financial structure that best suits an emerging market will differ from that of a developed market. Therefore, financial structure strategies that are tailor-made for individual emerging economies should be followed rather than mimicking the strategies of developed economies in order to achieve higher levels of economic development.

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Financial Development, Financial Structure, and the Growth Effect of Monetary Policy: International Evidence

Cited by 12 publications

References 37 publications

Asymmetric Impacts of Monetary Policy Shock on Output Gap: Evidence From Regions in Indonesia

Asymmetric Impacts of Monetary Policy Shock on Output Gap: Evidence From Regions in Indonesia

Financial inclusion and monetary policy effectiveness: A sustainable development approach of developed and under-developed countries

Fi̇nansal Si̇stemi̇n Yapisi İle Reel Ekonomi̇ Arasindaki̇ Di̇nami̇k Etki̇leşi̇m

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