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Patterns of Bank Credit Allocation and Economic Growth: The Case of Denmark, 1736-2012

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At present, relatively little is known about the relationship between bank credit allocation and economic growth. It seems clear that the structural characteristics of the banking system are significant factors influencing long-run allocation of credit across real sectors of the economy as well as across financial institutions. The purpose of this study is to examine the relationship between changes in credit allocation across sectors and economic growth in a long-term perspective. In addition, this study addresses changes appeared in the loanable funds among the different types of financial institutions for a number of long-run periods. During these periods, there were a number of waves of credit allocation as a result of economic transformation and high priorities were given by the major banks. During the periods under research, in reallocating their available funds, banks all affected almost by financial, monetary, and economic conditions in the country. Banking history in Denmark suggests that this study can contribute to fruitful field of inquiry for understanding bank credit allocation in relation to economic changes. Particular emphasis will be given in this paper to the contribution of savings banks, commercial banks, and mortgage institutions to the various sectors of the economy.

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  • Abou-Zeinab , Ali, 2013. "Patterns of Bank Credit Allocation and Economic Growth: The Case of Denmark, 1736-2012," Lund Papers in Economic History 131, Lund University, Department of Economic History.
    • Handle: RePEc:hhs:luekhi:0131
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    File URL: http://www.ekh.lu.se/media/ekh/forskning/lund_papers_in_economic_history/131.pdf
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    1. Steffen E. Andersen, 2011. "The Evolution of Nordic Finance," Palgrave Macmillan Studies in Banking and Financial Institutions, Palgrave Macmillan, number 978-0-230-29925-2, September.
    2. Edward P. M. Gardener & Philip Molyneux & Barry Moore (ed.), 2002. "Banking in the New Europe," Palgrave Macmillan Books, Palgrave Macmillan, number 978-0-230-59999-4.
    3. Kim Abildgren, 2012. "Financial structures and the real effects of credit-supply shocks in Denmark 1922-2011," European Review of Economic History, European Historical Economics Society, vol. 16(4), pages 490-510, November.
    4. Abildgren, Kim, 2009. "Credit Dynamics in Denmark since World War II," Nationaløkonomisk tidsskrift, Nationaløkonomisk Forening, vol. 2009(1), pages 89-119.
    5. Cândida Ferreira, 2012. "Bank market concentration and efficiency in the European Union: a panel granger causality approach," Working Papers Department of Economics 2012/03, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
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    More about this item

    Keywords

    banking history in Denmark; banking and economic growth; credit and economic growth; bank credit allocation;
    All these keywords.

    JEL classification:

    • N23 - Economic History - - Financial Markets and Institutions - - - Europe: Pre-1913
    • N24 - Economic History - - Financial Markets and Institutions - - - Europe: 1913-

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