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Financial Development and Economic Growth: Panel Data and Trilateral Analysis

Author

Listed:
  • Omidi , Nasrin

    (Ferdowsi University of Mashhad)

  • Fahimifard , Seyed Mohammad

    (Mashhad Chamber of Commerce, Industries, Mines and Agriculture)

Abstract

A large body of literatures links financial development to economic growth, yet the channels through which inflation and economic development affect this relationship have been less thoroughly explored. This research takes econometric and trilateral graphic approaches to examine these channels using 99 developing and developed countries during the years 1960-2009. Findings prove that respectively there is a positive, negative and neutral relationship between financial development and economic growth in low, high and very high level of inflation. The effect of countries development situation on finance-growth nexus shows that among the financial development indexes only the effect of M3 is different through developed and developing countries.

Suggested Citation

  • Omidi , Nasrin & Fahimifard , Seyed Mohammad, 2013. "Financial Development and Economic Growth: Panel Data and Trilateral Analysis," Journal of Money and Economy, Monetary and Banking Research Institute, Central Bank of the Islamic Republic of Iran, vol. 8(3), pages 151-166, July.
    • Handle: RePEc:mbr:jmonec:v:8:y:2013:i:3:p:151-166
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    References listed on IDEAS

    as
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    4. Christopoulos, Dimitris K. & Tsionas, Efthymios G., 2004. "Financial development and economic growth: evidence from panel unit root and cointegration tests," Journal of Development Economics, Elsevier, vol. 73(1), pages 55-74, February.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Financial development; Economic growth; Inflation; Economic development; Trilateral analysis.;
    All these keywords.

    JEL classification:

    • C12 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Hypothesis Testing: General
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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