A NONPARAMETRIC MODEL OF FINANCIAL SYSTEM-ECONOMIC GROWTH NEXUS
Sagarika Mishra and
Paresh Narayan ()
No 2010_12, Economics Series from Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance
In this paper we examine a familiar topic in financial economics: the financial system-economic growth nexus. However, we depart from the extant literature in the sense that we empirically show that proposed models and variables are nonparametric, implying that the use of estimation techniques that assume a linear data generating process are questionable. We, thus, use a nonparametric panel data model to estimate the financial-economic growth relationship. We find that the banking sector shows a greater case of a statistically significant positive effect on GDP: for example, domestic credit and private credit both have a statistically significant positive effect on GDP in six of the seven panels. On the other hand, the evidence from the stock market suggests relatively less cases of a statistically significant positive effect on GDP: for only four panels in the case of market capitalization and two panels in the case of stocks traded.
New Economics Papers: this item is included in nep-ban and nep-fdg
References: View references in EconPapers View complete reference list from CitEc
Citations Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: http://EconPapers.repec.org/RePEc:dkn:econwp:eco_2010_12
Access Statistics for this paper
More papers in Economics Series from Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance
Address: 221 Burwood Highway, Burwood 3125
Series data maintained by Dr Xueli Tang ().