You are currently offline. THE JOURNAL OF FINANCE * VOL. The threshold of the ratio between private credit and GDP above which the contribution of a further expansion of credit to industry growth is negative depends on the degree of industries’ own and upstream financial dependence values and slightly varies across sectors, ranging from 89% to 87%, with higher thresholds observed for sectors with lower own financial dependence but higher upstream … Cetorelli is at the Federal Reserve Bank of Chicago and Gambera is at Morningstar, Inc. Financial Dependence, Banking Sector Competition, and Economic Growth. Financial dependence and growth since the crisis (1) Volume 12 No 3 | 7 I.1. Nicola Cetorelli. Cetorelli, N. and Gamberra, M. (2001): “Banking market structure, financial dependence and growth: international evidence from industry data”, Journal of Finance 56, 617-648. Abstract: Does finance affect economic growth? © 1998 American Economic Association CiteSeerX - Document Details (Isaac Councill, Lee Giles, Pradeep Teregowda): This paper examines whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship; that financial development reduces the costs of external finance to firms. option. Bank for International Settlements (BIS) ... Financial Dependence and Growth. The role of the financial sector in economic growth, The dynamics of finance-growth nexus in advanced economies, Is the Relationship between Financial Development and Economic Growth Monotonic? As has been noted elsewhere, the observed correlation does not necessarily imply a causal relationship. Financial Dependence and Growth: Diminishing Returns to Improvement in Financial Development Leilei Shen Kansas State University April 7, 2013 Abstract This paper examines how much nancial development facilitates economic growth by nonpara-metrically estimating the e ect of nancial development on reducing the costs of external nance to rms. We find this to be true in a large sample of countries over the 1980's. A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. Nicola Cetorelli. For terms and use, please refer to our Terms and Conditions of Chicago, the Finance Krishna Kumar, Canice Prendergast, and … Banking Market Structure, Financial Dependence and Growth: International Evidence from Industry Data. Chakraborty, Atreya and Charles X. Hu (2006): “Lending relationships in line-of-credit and nonline-of-credit loans: evidence from collateral use in small business”, Journal of Financial Intermediation, forthcoming. Semantic Scholar is a free, AI-powered research tool for scientific literature, based at the Allen Institute for AI. Cetorelli N, Gambera M. Banking market structure, financial dependence and growth: International evidence from industry data. A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. The journal publishes 11 issues containing articles on a broad range of topics. In this paper we show that more efficient banks are particularly important in stimulating both output and productivity growth, while traditional volume measures of finance are much less important for productivity growth. As has been noted elsewhere, the observed correlation does not necessarily imply a causal relationship. 2 * APRIL 2001 Banking Market Structure, Financial Dependence and Growth: International Evidence from Industry Data NICOLA CETORELLI and MICHELE GAMBERA* ABSTERACT This paper explores the empirical relevance of banking market structure on growth. View Article Google Scholar 21. Financial Dependence, Stock Market Liberalizations, and Growth Nandini Gupta and Kathy Yuan∗ January 2002 Abstract Stock market liberalizations provide a natural experiment to test for the causal relation between financial development and economic Once composed primarily of college and university professors in economics, the American Economic Association (AEA) now attracts 20,000+ members from academe, business, government, and consulting groups within diverse disciplines from multi-cultural backgrounds. Country Growth Performance and Temporary Shocks, Domestic Saving and International Capital Flows Reconsidered, View 2 excerpts, cites results and methods, By clicking accept or continuing to use the site, you agree to the terms outlined in our. We show this result is unlikely to be driven by omitted variables, outliers, or reverse causality. The financial development and growth literature has established that finance matters for growth both at the macroeconomic and microeconomic levels (King and Levine 1993). NBER WO~G PAPER SERIES FINANCIAL DEPENDENCE AND GROWTH Raghuram G. Rajan Luigi Zingales Working Paper 5758 NATIONAL BUREAU OF ECONOMIC Avenue MA 02138 1996 RESEARCH 1050 Massachusetts Cambridge, September We thank Gene Fama, Peter Klenow, David Scharfstein, Robert Vishny, University comments. Raghuram Rajan and Luigi Zingales () American Economic Review, 1998, vol. Some features of the site may not work correctly. LVI, NO. The Journal of Finance. More>> Rajan, R.G. Abstract. The law and finance literature has found that financial markets are better developed in countries with strong legal frameworks (La Porta et al. The American Economic Review Financial Dependence, Banking Sector Competition, and Economic Growth. The American Economic Review is a general-interest economics journal. Evidence from a Sample of Middle Income Countries, Does too much finance harm economic growth, The nonlinear relationship between economic growth and financial development: Evidence from developing, emerging and advanced economies, The financial sector and economic growth in a panel of countries, Financial Development and Economic Growth: A Meta-Analysis, DOES FINANCIAL MARKET DEVELOPMENT MATTER IN EXPLAINING GROWTH FLUCTUATIONS, Financial Development, Growth, and the Distribution of Income, Finance and Growth: Schumpeter Might Be Right, Financial markets and growth: An overview☆, The Finance-Growth Nexus: Evidence from Bank Branch Deregulation, A Sensitivity Analysis of Cross-Country Growth Regressions, The Coevolution of the Real and Financial Sectors in the Growth Process, Good Policy or Good Luck? 1998; Beck et al. Abstract. Article citations. A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. JSTOR is part of ITHAKA, a not-for-profit organization helping the academic community use digital technologies to preserve the scholarly record and to advance research and teaching in sustainable ways. As has been noted elsewhere, the observed correlation does not necessarily imply a causal relationship. A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. This paper examines whether financial development facilitates economic growth by scrutinizing one rationale for such a relationship: that financial development reduces the costs of … As has been noted elsewhere, the observed correlation does not necessarily imply a causal relationship. Financial Dependence and Growth . small and medium size enterprises (SMEs) and, 3481. Banking Market Structure, Financial Dependence and Growth: International Evidence from Industry Data Nicola Cetorelli1 Michele Gambera October 1999 1Federal Reserve Bank of Chicago, 230 S. LaSalle St., Chicago, IL 60604-1413.E-mail: ncetorelli@frbchi.org and Michele.Gambera@chi.frb.org, respectively. We re-examine their assumptions, and the robustness of their results to alternative theories and interpretations. We widen the understanding of the finance-growth nexus by accounting for the indirect effect of financial development through input-output (IO) linkages in determining the growth of industries across countries. We revisit an earlier, highly influential paper on financial dependence and growth by Rajan and Zingales (1998). A number of studies have identified a positive correlation between the level of development of a country's financial sector and the rate of growth of its per capita income. 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