Does Non-intermediation Activity Tell us more in the Finance-Growth Nexus?

Han Hou () and Su-Yin Cheng ()
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Han Hou: Lunghwa University of Science and Technology
Su-Yin Cheng: Kainan University

No 5807316, Proceedings of International Academic Conferences from International Institute of Social and Economic Sciences

Abstract: This paper provides new evidences on traditional finance-growth nexus via dividing financial services into intermediation and non-intermediation services and examines their relationships with economic growth. Applying time series cointegration techniques and Granger causality tests for eight OECD countries, several results are obtained. First, there exists a long-run equilibrium relationship among economic growth, intermediation activities, and non-intermediation activities in Austria, France, and Korea. Second, we find that financial intermediation services promote long-run economic growth in France and Korea, whereas non-intermediation services impede Austria?s long-term economic growth. Finally, the development of non-intermediation activities leads the development of intermediation activities in France and the Netherlands in the short-term. This paper emphasizes the importance of non-intermediation activities in the growth process and in the development of intermediation services as well.

Keywords: financial Intermediation; non-intermediation; Economic growth; Causality (search for similar items in EconPapers)
JEL-codes: C32 F30 G20 (search for similar items in EconPapers)
Pages: 1 page
Date: 2017-10
New Economics Papers: this item is included in nep-fdg
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Published in Proceedings of the Proceedings of the 33rd International Academic Conference, Vienna, Oct 2017, pages 146-146

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Persistent link: https://EconPapers.repec.org/RePEc:sek:iacpro:5807316

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