The Rate of Interest

Robinson, Joan

doi:10.1007/978-1-349-16188-1_4

Cited by 74 publications

(89 citation statements)

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“…King and Levine, ; Neusser and Kugler, ; Rousseau and Wachtel, ; Levine et al ., ; Christopoulosa and Tsionas, ; Khan et al ., ; Qayyum, ; Shahbaz, ). Few studies view economic growth causes financial development (Robinson, ; Jung, ; Khan and Senhadji, ; Levine et al ., ). On other hand, few researches document the bidirectional relationship between financial development and economic growth (Demetriades and Hussein, ; Luintel and Khan, ).…”

Section: Literature Reviewmentioning

confidence: 99%

Re‐Visiting Financial Development and Economic Growth Nexus: The Role of Capitalization inBangladesh

Shahbaz

Rehman²,

Muzaffar

2014

South African J Economics

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This paper revisits the relationship between financial development and economic growth in Bangladesh by incorporating trade openness in production function using quarter frequency data over the period of 1976-2012. We applied combined Bayer-Hanck cointegration to examine cointegration amongst variables in the presence of structural breaks. The results show that financial development facilitates economic growth but capitalization impedes it. In addition, trade openness stimulates economic growth. Labour is also positively linked with economic growth. The causality analysis reveals the feedback effect between financial development and economic growth. Trade and labour Granger cause economic growth. This paper provides new insights for policy making authorities to use financial development and trade openness as tool to sustain economic growth in long run. This paper also suggests policy makers to utilise capitalization in proper way to sustain economic growth for long run.

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Section: Literature Reviewmentioning

confidence: 99%

Re‐Visiting Financial Development and Economic Growth Nexus: The Role of Capitalization inBangladesh

Shahbaz

Rehman²,

Muzaffar

2014

South African J Economics

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“…Expansion of the financial systems may be induced by higher per capita income due to increased demand for financial services. This is based on Robinson’s (1952) hypothesis that more financial institutions, products, and services will emerge in response to greater demand for financial services when an economy expands. The cost of financial services involves a significant fixed component, so average costs will fall if the volume of transactions increases.…”

Section: Analytical Frameworkmentioning

confidence: 99%

Are Financial Sector Policies Effective in Deepening the Malaysian Financial System?

Ang

2008

Contemporary Economic Policy

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"This paper provides an empirical assessment of the effects of financial sector policies on development of the financial system in Malaysia over the period 1959-2005. The technique of principal component analysis is used to construct a summary measure of interest rate policies in order to account for the joint influence of various interest rate controls imposed on the Malaysian financial system. The results show that economic development, interest rate controls, and capital liquidity requirements positively affect the level of financial development. However, greater trade openness, higher statutory reserve requirements, and the presence of directed credit programs appear to be harmful for development of the Malaysian financial system. The results provide some support to the argument that some form of financial restraints may help promote financial development. "("JEL "E44, E58, O16, O53) Copyright (c) 2008 Western Economic Association International.

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“…However, there seems to be a consensus in the existing literature that financial intermediary development is very likely to be endogenous either because of common omitted factors that drive a positive correlation between finance and growth, or simply because there might be more savings entering the financial system as the real economy grows, which in turn might allow it to extend new loans (Robinson, 1952; Lucas, 1988). It is also possible that growing countries provide more investment opportunities and demand relatively more financial services.…”

Section: Introductionmentioning

confidence: 99%

Non‐linear finance–growth nexus

Huang

Lin

2009

Economics of Transition

122

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This paper revisits the question of whether the finance-growth nexus varies with the stages of economic development. Using a novel threshold regression with the instrumental variables approach proposed by Caner and Hansen (2004) to the dataset used in Levine "et�al." (2000) we detect overwhelming evidence in support of a positive linkage between financial development and economic growth, and this positive effect is larger in the low-income countries than in the high-income ones. The data also reveal that financial development tends to have stronger impacts on capital accumulation and productivity growth in the low-income countries than in the high-income ones. The findings are robust to alternative financial development measures and conditioning information sets. Copyright (c) 2009 The Authors. Journal compilation (c) 2009 The European Bank for Reconstruction and Development.

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The Rate of Interest

Cited by 74 publications

References 0 publications

Re‐Visiting Financial Development and Economic Growth Nexus: The Role of Capitalization inBangladesh

Re‐Visiting Financial Development and Economic Growth Nexus: The Role of Capitalization inBangladesh

Are Financial Sector Policies Effective in Deepening the Malaysian Financial System?

Non‐linear finance–growth nexus

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