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Financial intermediation and economic growth

Author

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  • Leyla Yusifzada
  • Aytan Mammadova

Abstract

Financial depth does not fully reflect how well the financial intermediaries serve to economic agents in stimulating economic growth. Additional aspects of financial system such as access, efficiency and stability should be taken into account in order to shed light into the relationship between finance and economic growth. In our paper we capture the four aspects of finance ??? depth, access, efficiency and stability ??? to investigate the impact of financial development and economic growth. Our results suggest that the impact of four parameters of financial development differs depending on the level of financial development and has an inverted S-shape function.

Suggested Citation

  • Leyla Yusifzada & Aytan Mammadova, 2015. "Financial intermediation and economic growth," William Davidson Institute Working Papers Series wp1091, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:2015-1091
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    More about this item

    Keywords

    Financial intermediaries; financial development; economic growth; financial depth; access to finance; efficiency; financial stability;
    All these keywords.

    JEL classification:

    • E44 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Financial Markets and the Macroeconomy
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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