The Euro-adoption effect and the bank, market, and growth nexus: New evidence from EU panels

Georgantopoulos, Andreas G.; Tsamis, Anastasios; Agoraki, Maria‐Eleni K.

doi:10.1016/j.jeca.2015.01.002

Cited by 8 publications

(5 citation statements)

References 56 publications

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“…Even though it belongs among the latest studies, the observed period ends in 2007. Georgantopoulos et al (2015) studied the financial system-growth relationship for the EU countries separating them in the Euro area panel and the non-Euro countries for the period 1999-2012, however they did not take into account the opposite relationship. Their results indicate that stock market development is a significant growth factor in the Euro area panel, however the results for the non-Euro panel are insignificant.…”

Section: Literature Reviewmentioning

confidence: 99%

Stock Market Development and Economic Growth: Evidence from the European Union

Kajurová¹,

Rozmahel²

2017

Acta Univ. Agric. Silvic. Mendelianae Brun.

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The paper examines the causal relation between the stock markets development and economic growth in the EU countries. In particular, the nature and causality direction is investigated. Panel data techniques including cointegration tests, vector error correction models and Granger causality tests were applied to indicate the nature and direction of causality. Long‑run effects of the economic growth upon stock market development was detected in the sample of the Euro area member countries. In addition, the short‑run mutual relations between growth and stock markets were indicated in that country‑sample. In the non‑Euro area countries, only short‑run impact of the stock market development upon economic growth was found. The empirical findings bring up implications for macroeconomic stabilization and development policies. The indicated relations also play a role in predicting economic growth and stock markets’ development.

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Section: Literature Reviewmentioning

confidence: 99%

Stock Market Development and Economic Growth: Evidence from the European Union

Kajurová¹,

Rozmahel²

2017

Acta Univ. Agric. Silvic. Mendelianae Brun.

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“…The outcomes of employed tests indicated all variations of results: one-way relationship coming from stock market development to economic development (e.g. as in Beck and Levine, 2004;Nieuwerburgh et al, 2006;Nowbutsing and Odit, 2009;Tang, 2013;Gazdar and Cherif, 2015;Georgantopoulos et al, 2015 among others), one-way relationship coming from economic growth to stock market development (e.g. see Dritsaki and Dritsaki-Bargiota, 2005;Liu and Sinclair, 2008), mutual relationship (similar as e.g.…”

Section: Resultsmentioning

confidence: 72%

“…There is a prevailing amount of papers concluding that stock markets have impact on economic activity, e. g. Atje and Jovanovic (1993), Mauro (2003), Beck and Levine (2004), Nieuwerburgh et al (2006), Nowbutsing and Odit (2009), Panopoulou (2009), Nayaran and Nayaran (2013, Tang (2013), Cavenaile et al (2014), Prahdan et al (2014), Gazdar and Cherif (2015), Georgantopoulos et al (2015) or Prahdan et al (2015). Levine and Zevros (1998) find some variables not significant, but stock market liquidity is positively associated with contemporaneous and future growth rates.…”

Section: Literature Reviewmentioning

confidence: 99%

“…Also Deltuvaite and Sineviciene (2014), Georgantopoulos et al (2015) or Prahdan et al (2015) provided the results for EA countries in panels or clusters. However, such results cannot be generalized since they are not valid for every country included in the panel or cluster and one still has to be aware of the fact stated by Levine (1997) that any statements about the direction of causality cannot be generalized since they are specific to particular countries and periods.…”

Section: Introductionmentioning

confidence: 99%

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A Note on Relationship between Economic Activity and Stock Market Development: a Case of Euro Area Countries

Kajurová

2017

Acta Univ. Agric. Silvic. Mendelianae Brun.

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The aim of the paper is to empirically examine if the causal relationship between economic activity and stock market development exists in the selected 11 EA countries. The existence of relationship is investigated with the use of cointegration, vector error correction model and Granger causality during three sub-periods between January 1993 and January 2017. The results show that the general conclusion on the relation between activity and stock market development cannot be stated and that country-specific development should be taken into account when making decisions either from the investors' or policy makers' perspective. It also seems that the level of integration plays important role when studying the nature of relationship between variables during different time periods.

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“…Narayan and Narayan (2013) find, that bank credit has a negative effect on short-run growth for both a panel of 65 developing countries and a subset of European countries for the period of 1995-2011. However, research fails to find support for the bank-led growth hypothesis for a panel including the EU 26 member states for the period of 1999-2012 (Georgantopoulos et al, 2015). The conflicting evidence is in some way reconciled by more recent research that suggests the existence of a threshold above which finance is irrelevant or even detrimental to growth and show an inverted U-shaped relationship between private sector credit and GDP (Arcand et al, 2015;Cecchetti and Kharroubi, 2012).…”

Section: Literature Reviewmentioning

confidence: 99%

Financial intermediation, capital composition and income stagnation: The case of Europe

Samatas¹,

Makrominas

Moro

2019

Journal of Economic Behavior & Organization

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We look into the role of financial intermediation in inducing the European financial crisis of 2008 by exploring the effects of overall lending, and the allocation of credit to specific categories of borrowers, namely households vs. firms. We find that for the EU26 during the period 1995-2008, excessive household leverage through mortgage lending exerted a "crowdingout" effect on availability of credit to support innovation and productive investment. The crowding out effect ultimately translated into a GDP growth that was decoupled from real household income. In this article we explain that shifting credit towards mortgages and away from corporate projects is consistent with rational behaviour based on historical trends aimed at minimizing short-term risk for each individual bank. Nevertheless, as a whole, the sum of individual risk-reducing attitudes generated a long-term systemic risk.

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The Euro-adoption effect and the bank, market, and growth nexus: New evidence from EU panels

Cited by 8 publications

References 56 publications

Stock Market Development and Economic Growth: Evidence from the European Union

Stock Market Development and Economic Growth: Evidence from the European Union

A Note on Relationship between Economic Activity and Stock Market Development: a Case of Euro Area Countries

Financial intermediation, capital composition and income stagnation: The case of Europe

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