Working Paper: NBER ID: w9082
Authors: Thorsten Beck; Ross Levine
Abstract: This paper investigates the impact of stock markets and banks on economic growth using a panel data set for the period 1976-98 and applying recent GMM techniques developed for dynamic panels. On balance, we find that stock markets and banks positively influence economic growth and these findings are not due to potential biases induced by simultaneity, omitted variables or unobserved country-specific effects.
Keywords: stock markets; banks; economic growth; panel data; GMM techniques
JEL Codes: G00; O16; F36
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| stock market development (G10) | economic growth (O49) |
| bank development (G21) | economic growth (O49) |
| financial development (stock market and bank) (O16) | economic growth (O49) |
| stock market liquidity (G10) | economic growth (O49) |
| bank credit (G21) | economic growth (O49) |