Bank-based and market-based development and economic growth: an international investigation
| Autor: | Perpetual Boadi, Isaac Boadi, Daniel Osarfo |
|---|---|
| Rok vydání: | 2019 |
| Předmět: |
Market based
050208 finance media_common.quotation_subject 05 social sciences Fixed effects model Monetary economics Financial development Investment (macroeconomics) Originality 0502 economics and business Value (economics) Economics 050207 economics General Economics Econometrics and Finance media_common Generalized method of moments |
| Zdroj: | Studies in Economics and Finance. 36:365-394 |
| ISSN: | 1086-7376 |
| Popis: | Purpose The purpose of this paper is to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60countries. Design/methodology/approach This study uses fixed effect and generalized method of moments (GMM) to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries. The study further controls regional effects and the Asian crisis, as well as the global economic crisis. Findings The empirical results of the study revealed that market-based development positively affects economic growth. Besides, market-based financial development indirectly promotes investment, which has the potential to strongly enhance growth. The findings of this study, therefore, provide more support to pro-market-based financial development policies in these regions. Interestingly, bank-based development has no direct impact on development, but indirectly encourages investment, which also promotes growth. Originality/value This paper is the first of its kind to empirically examine fixed effect and GMM to investigate the relative impact of bank-based and market-based financial developments on economic growth from 1984 to 2015, using 60 countries. |
| Databáze: | OpenAIRE |
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