Too much finance?

Jean-Louis Arcand, Enrico Berkes and Ugo Panizza

Journal of Economic Growth, 2015, vol. 20, issue 2, 105-148

Abstract: This paper examines whether there is a threshold above which financial depth no longer has a positive effect on economic growth. We use different empirical approaches to show that financial depth starts having a negative effect on output growth when credit to the private sector reaches 100 % of GDP. Our results are consistent with the “vanishing effect” of financial depth and that they are not driven by endogeneity, output volatility, banking crises, low institutional quality, or by differences in bank regulation and supervision. Copyright Springer Science+Business Media New York 2015

Keywords: Finance; Growth; Financial crises; Non-linearities; O11; O16; E44; G1 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (446)

Downloads: (external link)
http://hdl.handle.net/10.1007/s10887-015-9115-2 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Too Much Finance? (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jecgro:v:20:y:2015:i:2:p:105-148

Ordering information: This journal article can be ordered from
http://www.springer. ... th/journal/10887/PS2

DOI: 10.1007/s10887-015-9115-2

Access Statistics for this article

Journal of Economic Growth is currently edited by Oded Galor

More articles in Journal of Economic Growth from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().