A Review Of Finance–Growth Nexus Theories: How Does Development Finance Fits In?
The finance growth-nexus debates have been contentious over the past three decades both empirically and theoretically. To contribute to this debate, the current paper presents a concise review of finance–growths nexus theoretical development and the current debate around growth-finance nexus theories. Then, it extends the current theoretical debate to include development finance within the broader scheme of finance-growth discourse. The key emerging trend is that, most of the contemporary theories trying to explain finance growth nexus have been exclusively focusing on the standard finance in general. Little attention has been devoted to understand the role of development finance on finance–growth nexus. It concludes that, for a more comprehensive understanding of the finance growth nexus, the role of development finance should be integrated in theory of finance–growth nexus. The paper demonstrates that conventional model of finance–growth nexus is more likely to underestimate the magnitude of the impact of finance on economic growth especially for less developed countries. The paper suggests that, a model which breakdown the finance into standard finance subgroup and development finance subgroup may provide more accurate and insightful findings.
Volume (Year): 10 (2015)
Issue (Month): 1 (April)
|Contact details of provider:|| Postal: Lucian Blaga University of Sibiu, Faculty of Economic Sciences Dumbravii Avenue, No 17, postal code 550324, Sibiu, Romania|
Phone: 004 0269 210375
Fax: 004 0269 210375
Web page: http://economice.ulbsibiu.ro/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert G. King & Ross Levine, 1993.
"Finance and Growth: Schumpeter Might Be Right,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 108(3), pages 717-737.
- King, Robert G.*Levine, Ross, 1993. "Finance and growth : Schumpeter might be right," Policy Research Working Paper Series 1083, The World Bank.
- Jean Arcand & Enrico Berkes & Ugo Panizza, 2015. "Too much finance?," Journal of Economic Growth, Springer, vol. 20(2), pages 105-148, June.
- Enrico G Berkes & Ugo Panizza & Jean-Louis Arcand, 2012. "Too Much Finance?," IMF Working Papers 12/161, International Monetary Fund.
- Michael Thiel, 2001. "Finance and economic growth - a review of theory and the available evidence," European Economy - Economic Papers 2008 - 2015 158, Directorate General Economic and Financial Affairs (DG ECFIN), European Commission.
- Arestis, Philip & Demetriades, Panicos O, 1997. "Financial Development and Economic Growth: Assessing the Evidence," Economic Journal, Royal Economic Society, vol. 107(442), pages 783-799, May.
- Panicos O. Demetriades & Philip Arestis, 1996. "Financial Development and Economic Growth: Assessing the Evidence," Keele Department of Economics Discussion Papers (1995-2001) 96/16, Department of Economics, Keele University.
When requesting a correction, please mention this item's handle: RePEc:blg:journl:v:10:y:2015:i:1:p:83-91. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mihaela Herciu)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.