Financial development and the occurrence of banking crises
Clément Mathonnat and
Alexandru Minea ()
Journal of Banking & Finance, 2018, vol. 96, issue C, 344-354
We perform an in-depth analysis of the effect of different dimensions of financial development on the occurrence of banking crises. Horse-race estimations carried out on a large dataset of 113 banking crises in 112 countries reveal that the growth of M3/GDP and the level of banks’ Credits/Deposits increase the occurrence of banking crises, while the growth and sometimes the volatility of the ratio of banks’ assets to the sum of banks’ and the Central Bank's assets decrease it. In addition, we do not find a significant effect of banks’ Credits/GDP. Finally, we unveil heterogeneities related to nonlinearities in the effect of financial development, the time span for the pre-crisis dynamics of financial development, and the level of economic development. Our results suggest that only some dimensions of financial development are significantly associated with the occurrence of banking crises.
Keywords: Financial development; Banking crises; Economic development (search for similar items in EconPapers)
JEL-codes: F30 G01 O11 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:jbfina:v:96:y:2018:i:c:p:344-354
Access Statistics for this article
Journal of Banking & Finance is currently edited by Ike Mathur
More articles in Journal of Banking & Finance from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().