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Financial structure and economic growth: the role of heterogeneity

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  • Karl Pinno
  • Apostolos Serletis

Abstract

In this article we use Bayesian classification and finite mixture models to extract information from Levine's (2002) cross-country database and reconsider the relationship between financial structure and long-run economic growth. Our methods, based on statistical similarities and multi-dimensional structures, allow for parameter heterogeneity across the countries in Levine's database and yield substantially different findings than Levine's regarding the relationship between financial structure and economic performance.

Suggested Citation

  • Karl Pinno & Apostolos Serletis, 2007. "Financial structure and economic growth: the role of heterogeneity," Applied Financial Economics, Taylor & Francis Journals, vol. 17(14), pages 1129-1139.
    • Handle: RePEc:taf:apfiec:v:17:y:2007:i:14:p:1129-1139
    DOI: 10.1080/09603100600749238
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    Cited by:

    1. Guangdong Xu, 2022. "From financial structure to economic growth: Theory, evidence and challenges," Economic Notes, Banca Monte dei Paschi di Siena SpA, vol. 51(1), February.
    2. Yeh, Chih-Chuan & Huang, Ho-Chuan (River) & Lin, Pei-Chien, 2013. "Financial structure on growth and volatility," Economic Modelling, Elsevier, vol. 35(C), pages 391-400.
    3. Alexandr Akimov & Albert Wijeweera & Brian Dollery, 2009. "Financial development and economic growth: evidence from transition economies," Applied Financial Economics, Taylor & Francis Journals, vol. 19(12), pages 999-1008.
    4. Xu Guangdong, 2021. "Reassessing the Literature on the Relationship Between Financial Structure and Economic Growth," Review of Economics, De Gruyter, vol. 72(2), pages 149-182, August.

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