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Economic growth and financial development in Brazil: a flexible regression model approach

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  • Pessoa, Filipe de Morais Cangussu
  • Braga, Marcelo José

Abstract

This paper examines the relationship between economic growth and financial development in Brazil. To this end, a data panel is constructed of all the Brazilian states for the period 1995–2014, with appropriate control variables and proxies for economic growth and financial development. The relationship is analysed for five different indicators of financial development, with a view to capturing its different aspects. Flexible regression modelling determines the direction of this relationship, characterizing it as linear or non-linear for each financial development indicator. It is concluded that the relationship between financial development and economic growth is positive and non-linear.

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  • Pessoa, Filipe de Morais Cangussu & Braga, Marcelo José, 2019. "Economic growth and financial development in Brazil: a flexible regression model approach," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), August.
    • Handle: RePEc:ecr:col070:44981
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    1. Iwasaki, Ichiro, 2022. "The finance-growth nexus in Latin America and the Caribbean: A meta-analytic perspective," World Development, Elsevier, vol. 149(C).

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