Finance and European regional economy

John Inekwe

International Review of Financial Analysis, 2021, vol. 78, issue C

Abstract: This study computes banking risk indexes for European developing countries and analyses the impact of identified risk factors on economic growth across regions and cities. We examine the short-run and long-run behaviours of the series. The results reveal that real gross domestic product (RGDP) per capita co-moves with banking risk. We find that about 17% of focal regions suffer significantly from banking risk shocks. The effect ranges from 0.1% to 0.7%, with a lower magnitude for cities. Banking risk has the most detrimental effects in Russia. Short- and long-run decrements in RGDP range between 0.2% and 0.3% across the panel.

Keywords: Banking risk; Regional RGDP; Developing countries; Europe (search for similar items in EconPapers)
JEL-codes: E23 E44 O16 R11 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finana:v:78:y:2021:i:c:s1057521921002477

DOI: 10.1016/j.irfa.2021.101921

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