The Evolution of the Finance Growth Nexus
The role of the financial sector in economic growth received scant attention from economists until very recently. An explosion of research in the last 20 years has firmly entrenched the finance growth nexus in the canon of economic beliefs. This paper suggests that the literature might have over emphasised the strength of the nexus that is much more nuanced than often suggested. The most commonly used measure of financial sector development, financial depth, is difficult to interpret because it can be a reflection of economy wide leverage as well as the quality and quantity of intermediation. Our examination of experience with financial deepening and of other measures of financial activity such as value added does not suggest that finance is unimportant. Instead, it shows how difficult it is to measure financial sector activity adequately.
Volume (Year): 53 (2011)
Issue (Month): 3 (September)
|Contact details of provider:|| Web page: http://www.palgrave-journals.com/|
|Order Information:||Web: http://www.springer.com/economics/journal/41294/PS2|
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.:
- Peter L. Rousseau & Paul Wachtel, 2011.
"What Is Happening To The Impact Of Financial Deepening On Economic Growth?,"
Western Economic Association International, vol. 49(1), pages 276-288, 01.
- Paul Wachtel & Peter L. Rousseau, 2006. "What is happening to the impact of financial deepening on economic growth?," Working Papers 06-15, New York University, Leonard N. Stern School of Business, Department of Economics.
- Peter L. Rousseau & Paul Wachtel, 2009. "What is Happening to the Impact of Financial Deepening on Economic Growth?," Vanderbilt University Department of Economics Working Papers 0915, Vanderbilt University Department of Economics.
- 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.
- Ross Levine, 1997. "Financial Development and Economic Growth: Views and Agenda," Journal of Economic Literature, American Economic Association, vol. 35(2), pages 688-726, June.
- Levine, Ross, 1996. "Financial development and economic growth : views and agenda," Policy Research Working Paper Series 1678, The World Bank.
- Martin Neil Baily & Robert J. Gordon, 1988. "The Productivity Slowdown, Measurement Issues, and the Explosion of Computer Power," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 347-432.
- Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 407-443.
- Robert J. Barro, 1989. "Economic Growth in a Cross Section of Countries," NBER Working Papers 3120, National Bureau of Economic Research, Inc.
- Barro, R.J., 1989. "Economic Growth In A Cross Section Of Countries," RCER Working Papers 201, University of Rochester - Center for Economic Research (RCER).
- John Page, 1994. "The East Asian Miracle: Four Lessons for Development Policy," NBER Chapters,in: NBER Macroeconomics Annual 1994, Volume 9, pages 219-282 National Bureau of Economic Research, Inc.
- Wachtel, Paul, 2001. "Growth and Finance: What Do We Know and How Do We Know It?," International Finance, Wiley Blackwell, vol. 4(3), pages 335-362, Winter.
- Rousseau, Peter L & Wachtel, Paul, 1998. "Financial Intermediation and Economic Performance: Historical Evidence from Five Industrialized Countries," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 30(4), pages 657-678, November.
- Carmen M. Reinhart & Vincent Reinhart, 2010. "After the fall," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 17-60.
- Reinhart, Carmen & Reinhart, Vincent, 2010. "Diminished Expectations, Double Dips, and External Shocks: The Decade After the Fall," MPRA Paper 24969, University Library of Munich, Germany.
- Carmen M. Reinhart & Vincent R. Reinhart, 2010. "After the Fall," NBER Working Papers 16334, National Bureau of Economic Research, Inc.
- Kraft, Evan & Jankov, Ljubinko, 2005. "Does speed kill? Lending booms and their consequences in Croatia," Journal of Banking & Finance, Elsevier, vol. 29(1), pages 105-121, January.
- Steven Radelet & Jeffrey D. Sachs, 1998. "The East Asian Financial Crisis: Diagnosis, Remedies, Prospects," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 29(1), pages 1-90. Full references (including those not matched with items on IDEAS)