IDEAS home Printed from https://ideas.repec.org/h/spr/prbchp/978-3-319-66872-7_12.html
   My bibliography  Save this book chapter

Analysis of the Effect of Developments in Banking Sector on the Economic Development: The Case of Turkey

In: New Challenges in Banking and Finance

Author

Listed:
  • Gökhan Işıl

    (Marmara University)

  • Esra Erik

    (Nişantaşı University)

Abstract

Banks, which are the building blocks of the financial system, manage the loanable fund supply and demand in economics through their “mediation” function. Enlargement of financial market volume also brings increase in national income and employment. Other important function of the banks in macroeconomic aspect is the fact that the provided funds to the financial system guide to sectors which will provide the most value to the economic growth. In this respect, existence of a strong financial system depends on a healthy growing and developing financial sector. In a country, such as Turkey, which has a saving gap, the importance of the banking sector on best usage of financial savings and procurement of economic growth through a stable economic development is undeniable. In this work, based on this point of view; the relationship between the developments in the banking sector and the economic development, within Turkey’s economy, is tested by regression analysis method. Within this work, Human Development Index (HDI), as a dependent variable, is used to define the economic development. In order to show the development of the banking sector, independent variables, part of banking sector in finance sector (BGY), monetary easing (M2GY), development in the total credit volume of the banking sector (KGY), development in the total deposits volume of the banking sector (MGY) and development in the total assets of the banking sector (AGY) variables are used. As a result of the regression analysis and performed tests, it is concluded that HDI variable will increase by 14% if AGY variable increases by 1%, HDI variable will increase by 18% if KGY variable increases by 1%, HDI variable will increase by 17% if MGY variable increases by 1%, HDI variable will increase by 27% if BGY variable increases by 1% and HDI variable will increase by 21% if M2GY variable increases by 1%. As a result of the literature work and the analysis performed, it is concluded that the developments in the banking sector positively effects the economic development in Turkey.

Suggested Citation

  • Gökhan Işıl & Esra Erik, 2017. "Analysis of the Effect of Developments in Banking Sector on the Economic Development: The Case of Turkey," Springer Proceedings in Business and Economics, in: NESRIN ÖZATAÇ & Korhan K. GÖKMENOGLU (ed.), New Challenges in Banking and Finance, pages 153-170, Springer.
    • Handle: RePEc:spr:prbchp:978-3-319-66872-7_12
    DOI: 10.1007/978-3-319-66872-7_12
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:prbchp:978-3-319-66872-7_12. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.