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Développement financier, instabilité financière et croissance économique

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  • Sylviane GUILLAUMONT JEANNENEY

    ()
    (Centre d'Etudes et de Recherches sur le Développement International)

  • Kangni KPODAR

    ()
    (Fonds Monétaire International)

Abstract

This paper tries to take into account two contrasted points of view that can be found the literature: the first one showing that financial development has a positive effect on economic growth, and the second one stressing the unfavourable effect of financial crisis. Our main assumption is that financial instability is positively correlated with financial development. Therefore, the favourable impact of financial development on economic growth is reduced. Theoretical arguments are presented to support this assumption, which is tested successfully on a sample of developing countries over the period 1966-2000. This suggests that a policy of financial liberalization, intending to promote financial development, should be implemented in a suitable political and economic environment.

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Bibliographic Info

Paper provided by CERDI in its series Working Papers with number 200413.

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Length: 40
Date of creation: 2004
Date of revision:
Handle: RePEc:cdi:wpaper:625

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Keywords: economic growth; Financial Development;

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References

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  1. Levine, Ross, 1996. "Financial development and economic growth : views and agenda," Policy Research Working Paper Series 1678, The World Bank.
  2. Roubini, Nouriel & Sala-i-Martin, Xavier, 1992. "Financial repression and economic growth," Journal of Development Economics, Elsevier, Elsevier, vol. 39(1), pages 5-30, July.
  3. King, Robert G. & Levine, Ross, 1993. "Finance and growth : Schumpeter might be right," Policy Research Working Paper Series 1083, The World Bank.
  4. King, Robert G. & Levine, Ross, 1993. "Finance and growth : Schumpeter might be right," Policy Research Working Paper Series 1083, The World Bank.
  5. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, Elsevier, vol. 87(1), pages 115-143, August.
  6. Khan, Arshad & Qayyum, Abdul & Sheikh, Saeed, 2005. "Financial Development and Economic Growth: The Case of Pakistan," MPRA Paper 2145, University Library of Munich, Germany, revised 2005.
  7. Christopoulos, Dimitris K. & Tsionas, Efthymios G., 2004. "Financial development and economic growth: evidence from panel unit root and cointegration tests," Journal of Development Economics, Elsevier, Elsevier, vol. 73(1), pages 55-74, February.
  8. Luintel, Kul B. & Khan, Mosahid, 1999. "A quantitative reassessment of the finance-growth nexus: evidence from a multivariate VAR," Journal of Development Economics, Elsevier, Elsevier, vol. 60(2), pages 381-405, December.
  9. Deidda, Luca & Fattouh, Bassam, 2002. "Non-linearity between finance and growth," Economics Letters, Elsevier, Elsevier, vol. 74(3), pages 339-345, February.
  10. M Arellano & O Bover, 1990. "Another Look at the Instrumental Variable Estimation of Error-Components Models," CEP Discussion Papers dp0007, Centre for Economic Performance, LSE.
  11. Loayza, Norman V. & Ranciere, Romain, 2006. "Financial Development, Financial Fragility, and Growth," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 38(4), pages 1051-1076, June.
  12. Boot, Arnoud W. A., 2000. "Relationship Banking: What Do We Know?," Journal of Financial Intermediation, Elsevier, Elsevier, vol. 9(1), pages 7-25, January.
  13. Graciela L. Kaminsky & Carmen M. Reinhart, 1996. "The twin crises: the causes of banking and balance-of-payments problems," International Finance Discussion Papers, Board of Governors of the Federal Reserve System (U.S.) 544, Board of Governors of the Federal Reserve System (U.S.).
  14. Easterly, William, 1993. "How much do distortions affect growth?," Journal of Monetary Economics, Elsevier, Elsevier, vol. 32(2), pages 187-212, November.
  15. Dollar, David & Kraay, Aart, 2002. " Growth Is Good for the Poor," Journal of Economic Growth, Springer, Springer, vol. 7(3), pages 195-225, September.
  16. Ross Levine & Norman Loayza & Thorsten Beck, 2002. "Financial Intermediation and Growth: Causality and Causes," Central Banking, Analysis, and Economic Policies Book Series, in: Leonardo Hernández & Klaus Schmidt-Hebbel & Norman Loayza (Series Editor) & Klaus Schmidt-Hebbel (S (ed.), Banking, Financial Integration, and International Crises, edition 1, volume 3, chapter 2, pages 031-084 Central Bank of Chile.
  17. Kevin C. Murdock & Thomas F. Hellmann & Joseph E. Stiglitz, 2000. "Liberalization, Moral Hazard in Banking, and Prudential Regulation: Are Capital Requirements Enough?," American Economic Review, American Economic Association, American Economic Association, vol. 90(1), pages 147-165, March.
  18. Stiglitz, Joseph E, 1985. "Credit Markets and the Control of Capital," Journal of Money, Credit and Banking, Blackwell Publishing, Blackwell Publishing, vol. 17(2), pages 133-52, May.
  19. Pagano, Marco, 1993. "Financial markets and growth: An overview," European Economic Review, Elsevier, Elsevier, vol. 37(2-3), pages 613-622, April.
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Citations

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Cited by:
  1. Koloma, Yaya, 2012. "DETERMINANTS de la pauvreté et genre des bénéficiaires de microfinance au Mali
    [DETERMINANTS of poverty by gender of beneficiaries of microfinance in Mali]
    ," MPRA Paper 40644, University Library of Munich, Germany.
  2. Cissé, Aboubakar Sidiki, 2009. "Faible financement bancaire dans la zone uemoa : une analyse des causes de ce mal récurrent
    [Low financing in the waemu zone: an analysis of the causes of this disease recurring]
    ," MPRA Paper 40821, University Library of Munich, Germany, revised 24 Aug 2012.
  3. repec:pra:mprapa:40631 is not listed on IDEAS
  4. Semia RACHID, 2011. "Foreign Direct Investment and Financial Resilience: Case of the Mediterranean Countries," Review of Economic and Business Studies, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, Alexandru Ioan Cuza University, Faculty of Economics and Business Administration, issue 8, pages 235-258, December.

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