An empirical analysis of the relationship between bank credit and economic growth
This paper tests the hypothesis that bank credit is necessary for economic growth, depending on the country's level of economic and financial development. It also seeks to verify whether the relationship between financial development and economic growth is monotonic. For this, Granger's ca...
| Main Authors: | , , |
|---|---|
| Format: | Article |
| Language: | Portuguese |
| Published: |
Universidade Federal de Santa Catarina
2021-06-01
|
| Series: | Textos de Economia |
| Subjects: | |
| Online Access: | https://periodicos.ufsc.br/index.php/economia/article/view/72868 |
| _version_ | 1819098358425321472 |
|---|---|
| author | Marcos Roberto Vasconcelos Vitor Gomes Reginato Marina Silva da Cunha |
| author_facet | Marcos Roberto Vasconcelos Vitor Gomes Reginato Marina Silva da Cunha |
| author_sort | Marcos Roberto Vasconcelos |
| collection | DOAJ |
| description | This paper tests the hypothesis that bank credit is necessary for economic growth, depending on the country's level of economic and financial development. It also seeks to verify whether the relationship between financial development and economic growth is monotonic. For this, Granger's causality methodology is used for panel data, with data from 106 countries for the period between 1970 and 2016. It is observed that there was an expansion of world credit above the economic growth observed over the studied period. The main empirical findings indicate that, in general, credit causes economic growth and vice versa, in addition to verifying the non-monotonicity of the relationship between financial development and economic growth, so that, for very low credit / GDP indices, the causality of the credit to GDP is not verified. |
| first_indexed | 2024-12-22T00:29:43Z |
| format | Article |
| id | doaj.art-81eae83c25374e2b805238e0cb08859f |
| institution | Directory Open Access Journal |
| issn | 0103-6017 2175-8085 |
| language | Portuguese |
| last_indexed | 2024-12-22T00:29:43Z |
| publishDate | 2021-06-01 |
| publisher | Universidade Federal de Santa Catarina |
| record_format | Article |
| series | Textos de Economia |
| spelling | doaj.art-81eae83c25374e2b805238e0cb08859f2022-12-21T18:44:57ZporUniversidade Federal de Santa CatarinaTextos de Economia0103-60172175-80852021-06-0124110.5007/2175-8085.2021.e72868An empirical analysis of the relationship between bank credit and economic growthMarcos Roberto Vasconcelos0Vitor Gomes ReginatoMarina Silva da Cunha1Universidade Estadual de Maringá, Departamento de EconomiaProfessora titular da Universidade Estadual de Maringá, Departamento de EconomiaThis paper tests the hypothesis that bank credit is necessary for economic growth, depending on the country's level of economic and financial development. It also seeks to verify whether the relationship between financial development and economic growth is monotonic. For this, Granger's causality methodology is used for panel data, with data from 106 countries for the period between 1970 and 2016. It is observed that there was an expansion of world credit above the economic growth observed over the studied period. The main empirical findings indicate that, in general, credit causes economic growth and vice versa, in addition to verifying the non-monotonicity of the relationship between financial development and economic growth, so that, for very low credit / GDP indices, the causality of the credit to GDP is not verified.https://periodicos.ufsc.br/index.php/economia/article/view/72868Bank creditEconomic growthFinancial developmentCausality |
| spellingShingle | Marcos Roberto Vasconcelos Vitor Gomes Reginato Marina Silva da Cunha An empirical analysis of the relationship between bank credit and economic growth Textos de Economia Bank credit Economic growth Financial development Causality |
| title | An empirical analysis of the relationship between bank credit and economic growth |
| title_full | An empirical analysis of the relationship between bank credit and economic growth |
| title_fullStr | An empirical analysis of the relationship between bank credit and economic growth |
| title_full_unstemmed | An empirical analysis of the relationship between bank credit and economic growth |
| title_short | An empirical analysis of the relationship between bank credit and economic growth |
| title_sort | empirical analysis of the relationship between bank credit and economic growth |
| topic | Bank credit Economic growth Financial development Causality |
| url | https://periodicos.ufsc.br/index.php/economia/article/view/72868 |
| work_keys_str_mv | AT marcosrobertovasconcelos anempiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth AT vitorgomesreginato anempiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth AT marinasilvadacunha anempiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth AT marcosrobertovasconcelos empiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth AT vitorgomesreginato empiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth AT marinasilvadacunha empiricalanalysisoftherelationshipbetweenbankcreditandeconomicgrowth |