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Does the level of financial leasing matter in the impact of bank lending on economic growth: Evidence from the global market (2006–2016)

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  • Zhang, Ying
  • Zhai, Ling
  • Sun, Haijia

Abstract

This paper investigates whether the level of financial leasing influenced the relationship between bank lending and economic growth in the global market from 2006 to 2016. The empirical results from a dynamic panel threshold effect model show that (1) a financial leasing threshold effect exists in the relation between bank loans and economic growth, (2) at a moderate level of financial leasing, the boost that is provided by bank loans significantly promotes economic growth, and (3) at a high level of financial leasing, the positive impact of an increase in bank loans on economic growth is no longer applicable. Therefore, the utilisation of traditional and emerging financing tools in various economies should be based on a country's economic structure and financial intermediary system.

Suggested Citation

  • Zhang, Ying & Zhai, Ling & Sun, Haijia, 2019. "Does the level of financial leasing matter in the impact of bank lending on economic growth: Evidence from the global market (2006–2016)," Finance Research Letters, Elsevier, vol. 30(C), pages 352-359.
    • Handle: RePEc:eee:finlet:v:30:y:2019:i:c:p:352-359
    DOI: 10.1016/j.frl.2018.10.020
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    Cited by:

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    4. Xiaoye Liu & Kedong Yin & Yun Cao, 2021. "Contribution of the Optimization of Financial Structure to the Real Economy: Evidence from China’s Financial System Using TVP-VAR Model," Mathematics, MDPI, vol. 9(18), pages 1-21, September.

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    More about this item

    Keywords

    Economic growth; Bank loan; Financial leasing; Dynamic panel threshold effect model;
    All these keywords.

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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