Download This PaperWhat Matters in the Finance–Growth Nexus of Advanced Economies? Evidence from OECD Countries
MACIE Paper Series Nr. 2016/12
9 Pages Posted: 24 Jul 2016 Last revised: 9 Dec 2017
There are 2 versions of this paper
What Matters in the Finance–Growth Nexus of Advanced Economies? Evidence from OECD Countries
What Matters in the Finance-Growth Nexus of Advanced Economies? Evidence from OECD Countries
Date Written: July 22, 2016
Abstract
While the majority of empirical work examines growth effects of financial sector “size”, we provide evidence for the role of financial sector “structure”. Focusing on stock markets, we study OECD countries over the 1994-2013 period and find that relatively larger stock markets facilitate economic growth and mitigate economic risk. We find no such effect for private bond markets and private credit volume. Overall, our results suggest that financial sector “structure” matters for economic development of advanced economies highlighting the importance of addressing financial structure gaps.
Revised version is available at: https://ssrn.com/abstract=2976237
Keywords: Finance, Financial development, Stock market, Economic development, Growth
JEL Classification: E44, G10, O40
Suggested Citation: Suggested Citation