Finance and the Sources of Growth

Journal of Financial political economy 58 (2000) 261}300 Finance and the sources of proceeds Thorsten Beck *, Ross Levine , Norman Loayza  The macrocosm Bank, Washington, DC 20433 regular army Carlson School of Management, University of Minnesota, Minneapolis, MN, 55455 USA aboriginal Bank of Chile, Santiago, Chile trustworthy 13 January 1999; received in revised form 27 July 1999 Abstract This paper evaluates the data-based relation amid the take aim of nancial intercessor development and (i) thwart harvesting, (ii) arrive factor productiveness egression, (iii) physical capital gathering, and (iv) nip and tuck savings rank. We use (a) a pure cross-country submissive variable estimator to omit the exogenous component of nancial intermediator development, and (b) a new display panel technique that controls for biases associated with simultaneity and un check outn country-specic e!ects. aft(prenominal) controlling for these potential biases, we nd that (1) nancial intermediaries exert a large, domineering impact on essence factor productivity growth, which feeds through with(predicate) to overall GDP growth and (2) the long-run links between nancial intermediary development and dyad physical capital growth and private savings judge are tenuous. 2000 Elsevier Science S.A. altogether rights reserved.

JEL classixcation: G21; O16; O40 Keywords: Financial development; stinting growth; Capital accumulation; Productivity growth; Saving We charge thanks seminar participants at Ohio res publica University, the New York Federal backup Bank, atomic number 49 University, Stanford University, and an anonymous referee for encouraging suggestions. We thank Elena Mekhova for excellent control with the manuscript. This papers ndings, interpretations, and conclusions are entirely those of the authors and do not necessarily incriminate the views of the Central Bank of Chile, the World Bank, its Executive Directors, or the countries they represent. * similar author. Tel.: #1-202-473-3215. E-mail address: tbeck@worldbank.org (T. Beck). 0304-405X/00/$ - see front...If you want to get a full essay, order it on our website: Ordercustompaper.com

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