Types of banking institutions and economic growth: An endogenous growth model

Khaled Elmawazini (), Khiyar Abdalla Khiyar, Ahmad Al Galfy and Asiye Aydilek

No 2015-61, Economics Discussion Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: There is mixed support for the hypothesis that the banking sector is a channel for economic growth. While most studies on economic growth in Gulf Cooperation Council (GCC) countries have not distinguished between conventional banks and Islamic banks, this study contributes to the empirical literature by comparing the respective impacts of Islamic banks and commercial banks on economic growth among GCC countries during the period 2001-2009, bringing out policy implications. The main result of panel data regressions is that both conventional and Islamic banks have fuelled economic growth, with the latter having a more significant impact. These results contradict the findings of some single-country studies that have examined the impact of Islamic banking on economic growth.

Keywords: Finance; Economic growth; Dynamic panel data models; GCC countries (search for similar items in EconPapers)
JEL-codes: C2 G21 O53 (search for similar items in EconPapers)
Date: 2015
New Economics Papers: this item is included in nep-fdg and nep-gro
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https://www.econstor.eu/bitstream/10419/118640/1/834946734.pdf (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwedp:201561

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