Journal
ECONOMICS OF TRANSITION
Volume 17, Issue 3, Pages 439-466Publisher
WILEY
DOI: 10.1111/j.1468-0351.2009.00360.x
Keywords
C13; C21; O11; O16; Financial development; economic growth; instrumental variable; threshold regression
Categories
Ask authors/readers for more resources
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.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available