Local Banking and Local Economic Growth in Italy: Some Panel Evidence

Guglielmo Maria Caporale, Stefano Di Colli, Roberto Di Salvo and Juan Sergio Lopez

No 1409, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: This paper provides new evidence on the contribution of local banking to local economic growth (i.e. at county level – the Italian “province”) in Italy. A comprehensive dataset is used, which includes control variables for social capital and human capital as well as indicators of the quality of local infrastructures and the production structure of the local economy. A linear within-estimator technique with fixed effects is applied to a modified version of the so-called Barro regression (Cecchetti and Karrhoubi, 2013) in order to address the well-known econometric issues of reverse causality and estimation bias resulting from unobserved district-specific influences.

Keywords: Bank lending; local growth; panel data (search for similar items in EconPapers)
JEL-codes: C33 E44 G01 G32 (search for similar items in EconPapers)
Pages: 19 p.
Date: 2014
New Economics Papers: this item is included in nep-eff, nep-fdg, nep-mac and nep-ure
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Related works:
Journal Article: Local banking and local economic growth in Italy: some panel evidence (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwwpp:dp1409

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