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Finance and Macroeconomic Volatility

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Author Info

  • Cevdet Denizer

    (The World Bank)

  • Murat Iyigun

    (The Federal Reserve Board)

  • Ann Owen

    (Hamilton College)

Abstract

Countries with more developed financial sectors experience less fluctuations in real per capita output, consumption and investment growth. However, the manner in which the financial sector develops matters. The relative importance of banks in the financial system is important in explaining consumption and investment volatility, and the proportion of credit provided to the private sector explains the volatility of consumption and output. The main results are generated using fixed-effects estimation with panel data from 70 countries covering the years 1956 through 1998.

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File URL: http://128.118.178.162/eps/mac/papers/0004/0004015.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Macroeconomics with number 0004015.

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Length: 22 pages
Date of creation: 14 Jun 2000
Date of revision:
Handle: RePEc:wpa:wuwpma:0004015

Note: Type of Document - pdf; prepared on IBM PC ; to print on Postscript; pages: 22 ; figures: tables available in separate file, fincyctbl.pdf
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Web page: http://128.118.178.162

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Keywords: financial development; business cycles; economic fluctuations;

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References

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