Stock markets, banks, and growth: Panel evidence

This paper investigates the impact of stock markets and banks on economic growth using a panel data set for the period 1976-1998 and applying recent generalized-method-of moments techniques developed for dynamic panels. On balance, we find that stock markets and banks positively influence economic growth and these findings are not due to potential biases induced by simultaneity, omitted variables or unobserved country-specific effects. (C) 2002 Elsevier B.V. All rights reserved.