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The impacts of Shadow banking system on economy. An empirical analysis

Author

Listed:
  • Altaf Hussain
  • Jianbo Bao
  • Fanli

Abstract

This paper analyzes the impacts of Shadow banking system (SBS) on the nominal and real economy. It studies the SBS’s data of 14 countries for 13 years using Generalizing estimation equation (GEE) method in SPSS statistics. The results showed that the increase in SBS was associated with large increase in nominal GDP rather than real GDP and thus causing nominal indicators of the economy to grow more than real ones. The paper concluded by suggesting that the SBS should be regulated and its size should be reduced from the current level to make financial system more stable and prevent future financial crisis. JEL classification numbers: G2

Suggested Citation

  • Altaf Hussain & Jianbo Bao & Fanli, 2019. "The impacts of Shadow banking system on economy. An empirical analysis," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 9(3), pages 1-1.
    • Handle: RePEc:spt:apfiba:v:9:y:2019:i:3:f:9_3_1
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    References listed on IDEAS

    as
    1. Artak Harutyunyan & Mr. Alexander Massara & Giovanni Ugazio & Goran Amidžic & Richard Walton, 2015. "Shedding Light on Shadow Banking," IMF Working Papers 2015/001, International Monetary Fund.
    2. Buch, Claudia M. & Neugebauer, Katja, 2011. "Bank-specific shocks and the real economy," Journal of Banking & Finance, Elsevier, vol. 35(8), pages 2179-2187, August.
    3. Tan, Yong, 2017. "The impacts of competition and shadow banking on profitability: Evidence from the Chinese banking industry," The North American Journal of Economics and Finance, Elsevier, vol. 42(C), pages 89-106.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Shadow banking system; Nominal and real economy; Generalizing estimation equation (GEE).;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services

    Statistics

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