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The Impact of European Monetary Union on Finance-Growth Nexus

Author

Listed:
  • Saeed Armin
  • Saifuzzaman Ibrahim
  • W. Azman-Saini

Abstract

This study examines the relationship between financial development and economic growth in 15 developed European countries before and after the formation of the euro. The results of the panel data analysis show that financial development is significant in promoting economic growth for both periods. The impact of the banking sector development on growth, however, is greater in the post-euro period, whereas the impact of stock market development on growth is reducing in the period investigated. The study concludes that the formation of European Monetary Union does not weaken the relationship between financial development and economic growth in developed European countries. Copyright Springer-Verlag Wien 2013

Suggested Citation

  • Saeed Armin & Saifuzzaman Ibrahim & W. Azman-Saini, 2013. "The Impact of European Monetary Union on Finance-Growth Nexus," Transition Studies Review, Springer;Central Eastern European University Network (CEEUN), vol. 19(3), pages 347-356, February.
    • Handle: RePEc:spr:trstrv:v:19:y:2013:i:3:p:347-356
    DOI: 10.1007/s11300-012-0249-z
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    More about this item

    Keywords

    Financial development; Economic growth; European monetary union; Panel data analysis; O43; F36; G15; O52;
    All these keywords.

    JEL classification:

    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
    • G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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