Finance and the Sources of Growth

Abstract

No AccessPolicy Research Working Papers25 Jun 2013Finance and the Sources of GrowthAuthors/Editors: Ross Levine, Thorsten Beck, and Norman LoayzaRoss Levine, Thorsten Beck, and Norman Loayzahttps://doi.org/10.1596/1813-9450-2057SectionsAboutPDF (0.1 MB) ToolsAdd to favoritesDownload CitationsTrack Citations ShareFacebookTwitterLinked In Abstract:Development of the banking sector exerts a large, causal impact on total factor productivity growth, which in turn causes GDP to grow. Whether banking development has a long-run effect on capital growth or private saving remains to be seen. Beck, Levine, and Loayza evaluate whether the level of development in the banking sector exerts a causal impact on economic growth and its sources- total factor productivity growth, physical capital accumulation, and private saving. They use (1) a pure cross-country instrumental variable estimator to extract the exogenous component of banking development and (2) a new panel technique that controls for country-specific effects and endogeneity. They find that: ° Banks do exert a large, causal impact on total factor productivity growth, which feeds through to overall GDP growth. ° The long-run links between banking development and both capital growth and private savings are more tenuous. This paper-a product of Finance, Development Research Group-is part of a larger effort in the group to understand the links between the financial system and economic growth. Thorsten Beck may be contacted at [email protected]. Previous bookNext book FiguresreferencesRecommendeddetailsCited byFINANCIAL DEPTH OF UKRAINE'S ECONOMY: SECTORAL CROSS SECTIONEconomy of Ukraine, Vol.2022, No.1226 December 2022Türkiye'de Farklı Parasal Göstergeler ve İstihdam Değişimlerinin Ekonomik Büyümeye EtkisiAkademik Araştırmalar ve Çalışmalar Dergisi (AKAD), Vol.14, No.2625 May 2022Capital Account Liberalization, Political Stability, and Economic GrowthJournal of the Knowledge Economy, Vol.13, No.112 February 2021Financial depth in the context of the relationship with economic growthFìnansi Ukraïni, Vol.2021, No.64 August 2021Equidad y Desarrollo, No.22Stock MarketsInternational Journal of Finance & Banking Studies (2147-4486), Vol.2, No.421 October 2013Law Enforcement Proxies Matter for the Law and Finance NexusInternational Journal of Finance & Banking Studies (2147-4486), Vol.2, No.321 July 2013The Role of Financial Market in the Development of the Real Sector of the Russian EconomyMGIMO Review of International Relations, No.2(23)28 April 2012EMPIRICAL ANALYSIS OF SPECULATIVE ATTACKS WITH CONTRACTIONARY REAL EFFECTSIntelligent Systems in Accounting, Finance and Management, Vol.19, No.222 May 2012Review of China Financial SystemSSRN Electronic JournalStock Market and Banking sector Development in Turkey: Do they have the Same Impact on Economic Growth?Economic Research-Ekonomska Istraživanja, Vol.24, No.49 November 2015Finance and Growth: A Schumpeterian Trip to AfricaSSRN Electronic JournalLegal Institutions and Economic DevelopmentSSRN Electronic JournalGovernment Expenditure, Governance and Economic GrowthComparative Economic Studies, Vol.51, No.34 June 2009Does stock market liberalization spur financial and economic development in the MENA region?Journal of Comparative Economics, Vol.36, No.4Stock markets, banks, and economic growth: Empirical evidence from the MENA regionResearch in International Business and Finance, Vol.21, No.2Unique Symptoms of Japanese Stagnation: An Equity Market PerspectiveJournal of Money, Credit and Banking, Vol.39, No.48 June 2007The Impact of Financial Intermediation on Economic Growth: The Nigerian PerspectiveSSRN Electronic JournalThe composition of international capital flows: risk sharing through foreign direct investmentJournal of International Economics, Vol.61, No.2Law, Finance, and Economic GrowthJournal of Financial Intermediation, Vol.8, No.1-2 View Published: February 1999 Copyright & Permissions Related Regions Africa Latin America & Caribbean Related Countries Congo, Democratic Republic of New Zealand Nigeria Timor-Leste Uruguay Related Topics Finance and Financial Sector Development Macroeconomics and Economic Growth Poverty Reduction Private Sector Development KeywordsCAPITALDEVELOPMENTDEVELOPMENT ECONOMICSECONOMIC GROWTHECONOMIC PROGRESSECONOMICS LITERATUREGDPGROSS DOMESTIC PRODUCTGROWTH RATEHUMAN CAPITALINFLUENCEMACROECONOMICSPRODUCTIVITYPRODUCTIVITY GROWTHSAVINGSSTOCKTHEORYTOTAL FACTOR PRODUCTIVITYTOTAL FACTOR PRODUCTIVITY GROWTHVARIABLES PDF DownloadLoading ...