Non-linear growth effects of financial development: Does financial integration matter?

Masten, Arjana Brezigar; Coricelli, Fabrizio; Masten, Igor

doi:10.1016/j.jimonfin.2007.12.009

Cited by 152 publications

(58 citation statements)

References 25 publications

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“…Consequently, the effects of well-established banking system should be reflected through size-based measures of financial development. The evidence is consistent with (Masten et al, 2008), they argue that credit to the private sector plays important role as developing countries benefits considerably more from money market development and it is a key driver for economic growth. The same results were found by (Thumrongvit et al, 2013b).…”

Section: Normalized Co-integrating Coefficients: At 1 Co-integrating supporting

confidence: 72%

“…Calderón and Liu (2003) argue that the contribution of financial deepening towards growth is more in developing economies compare to developed economies. While examine the European countries' sample, Masten, Coricelli, and Masten (2008) found the same results and describe that developing countries grow more from development of financial sector. (2004) analyze a significant positive impact of financial deepening on economic development.…”

Section: Review Of Literaturementioning

confidence: 68%

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Relationship Between Financial and Real Sectors: Implications for Stable Economic Development (Evidence from Thailand)

Khalil¹,

Chaisrisawatsuk²

2018

IJEF

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The real sector of an economy is the key section as activities of this sector persuade economic output and is represented by those economic segments that are essential for the progress of GDP of the economy. The sector generates better outcomes if accompanied with a healthier financial system; thus, advancement of financial sector is a means for the growth of real sector. The study in this paper explores the relationship between financial and real sectors of Thailand with the volatility analysis of GDP caused by development of financial market. The GARCH Model, Johansen-Juselius (1990) co-integration test, vector error correction model (VECM), and Granger causality testing approach was employed on time series data over the first quarter of year 1993 until the second quarter of year 2017. Consistent with past studies, both the elements of capital market (i.e. bonds and stock markets) and the money market (i.e. credit to private sector by banks) bears a positive relationship to the GDP, our results shows that both markets help promoting economic growth. We can infer that differences in financial markets' composition and institutions do matter, as these three major sections -bond market, stock market, and banks-do not simultaneously develop and grow, but at a different level of their growth they complement each other. Our findings suggest that there exists inter dependency between real and financial sector's technologies which in turn enlightens the effect of financial market development on the GDP growth.

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Section: Normalized Co-integrating Coefficients: At 1 Co-integrating supporting

confidence: 72%

Section: Review Of Literaturementioning

confidence: 68%

Relationship Between Financial and Real Sectors: Implications for Stable Economic Development (Evidence from Thailand)

Khalil¹,

Chaisrisawatsuk²

2018

IJEF

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“…Leurs estimations suggèrent que l'effet de disparition pourrait être dû aux crises financières qui sont souvent associées à un développement financier rapide. Masten et al (2008) et Arcand et al (2012) fournissent une autre explication à l'effet de disparition. Masten et al (2008), qui se concentrent sur les économies européennes avancées et les économies en transition, observent un important effet de croissance du développement financier dans les économies en transition, mais aucun effet dans les pays de l'UE plus avancés.…”

Section: La Nouvelle Littérature Sur La Finance Et Le Développement éunclassified

“…Masten et al (2008) et Arcand et al (2012) fournissent une autre explication à l'effet de disparition. Masten et al (2008), qui se concentrent sur les économies européennes avancées et les économies en transition, observent un important effet de croissance du développement financier dans les économies en transition, mais aucun effet dans les pays de l'UE plus avancés. Ces auteurs suggèrent que si le développement financier peut être utile pour les pays en transition dotés d'un secteur financier relativement faible, le processus de développement financier n'est plus nécessaire pour les économies avancées de l'Union européenne.…”

Section: La Nouvelle Littérature Sur La Finance Et Le Développement éunclassified

Développement financier et croissance économique : les connus connus, les inconnus connus et les inconnus inconnus

Panizza¹

2014

Revue d'Économie Du Développement

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Développement financier et croissance économique : les connus connus, les inconnus connus et les inconnus inconnus », Revue d'économie du développement 2014/2 (Vol.La reproduction ou représentation de cet article, notamment par photocopie, n'est autorisée que dans les limites des conditions générales d'utilisation du site ou, le cas échéant, des conditions générales de la licence souscrite par votre établissement. Toute autre reproduction ou représentation, en tout ou partie, sous quelque forme et de quelque manière que ce soit, est interdite sauf accord préalable et écrit de l'éditeur, en dehors des cas prévus par la législation en vigueur en France. Il est précisé que son stockage dans une base de données est également interdit.section organizes the empirical literature on finance and growth into three strands: (i) the traditional literature which established the link between finance and growth; (ii) the new literature which qualified some of the results of the traditional literature; and (iii) the new-new literature which focuses on alternative measures of financial development and on the dark side of finance. The known unknowns section focuses on causality, on the channels through which finance affects growth, and on the dark side of finance. The unknown unknowns section discusses a topic on which we may know less than what we think we know.

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“…Furthermore, FDI flows in particular can provide technology spillovers via the transfer of knowledge. On the other hand, the indirect positive effects of financial openness on economic growth could come through its effect on the development of domestic financial markets via two channels (Brezigar-Masten et al, 2008). First, increased competition between foreign financial intermediaries can lead to reduced intermediation cost which in turn stimulates demand for funds thereby increasing the size of domestic financial markets.…”

Section: Literature Reviewmentioning

confidence: 99%

Capital Account Liberalization and Growth in the WAMZ: An Empirical Analysis

Egbuna¹,

Oniwoduokit²,

Mansaray³

et al. 2013

IJEF

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The paper employed recent time series econometrics to analyze and determine relationships between capital account liberalization and economic growth in the West African Monetary Zone 2 (WAMZ) for the period 1980-2012. For the purpose of clearly ascertaining the impact of the variables of interest on economic growth, a country by country estimation was carried out. The short-run and long-run relationships between capital account openness and economic growth were investigated by applying the autoregressive distributive lag (ARDL) bounds testing approach suggested by Pesaran et al. (2001). The empirical results of the ARDL models showed a significant positive relationship between capital account liberalization and growth in Ghana and Sierra Leone. This suggests that the removal of restrictions on capital accounts in Ghana and Sierra Leone would promote economic growth in these countries in the long-run. Liberalization had positive and significant impact on growth in Ghana even in the short-run. However, there was no significant long-run relationship between liberalization and growth in The Gambia, Guinea, Liberia and Nigeria, implying that opening of the capital account should be gradual and complemented with sound macroeconomic and financial policy. Overall, the diagnostic tests indicated that our ARDL models were stable.

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Non-linear growth effects of financial development: Does financial integration matter?

Cited by 152 publications

References 25 publications

Relationship Between Financial and Real Sectors: Implications for Stable Economic Development (Evidence from Thailand)

Relationship Between Financial and Real Sectors: Implications for Stable Economic Development (Evidence from Thailand)

Développement financier et croissance économique : les connus connus, les inconnus connus et les inconnus inconnus

Capital Account Liberalization and Growth in the WAMZ: An Empirical Analysis

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