Inflation Thresholds and the Finance-Growth Nexus PDF Download
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Author: Peter L. Rousseau
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
The robustness of the cross-sectional relationship between the size of a country's financial sector and its rate of economic growth is by now well established. In this article, we examine whether the strength of this relationship varies with the inflation rate. Using five-year averages of standard measures of financial development, inflation, and growth for 84 countries from 1960 to 1995, a series of rolling panel regressions show that there is an inflation threshold for the finance-growth relationship that lies between 13 and 25 percent. When inflation exceeds the threshold, finance ceases to increase economic growth. We also find that the level of financial depth varies inversely with inflation in low-inflation environments and that disinflation is associated with a positive effect of financial depth on growth.
Author: Peter L. Rousseau
Publisher:
ISBN:
Category :
Languages : en
Pages : 0
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Book Description
The robustness of the cross-sectional relationship between the size of a country's financial sector and its rate of economic growth is by now well established. In this article, we examine whether the strength of this relationship varies with the inflation rate. Using five-year averages of standard measures of financial development, inflation, and growth for 84 countries from 1960 to 1995, a series of rolling panel regressions show that there is an inflation threshold for the finance-growth relationship that lies between 13 and 25 percent. When inflation exceeds the threshold, finance ceases to increase economic growth. We also find that the level of financial depth varies inversely with inflation in low-inflation environments and that disinflation is associated with a positive effect of financial depth on growth.
Author: Peter L. Rousseau
Publisher:
ISBN:
Category :
Languages : en
Pages : 23
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Book Description
The robustness of the cross-sectional relationship between the size of a country's financial sector and its rate of economic growth is by now well established. In this article, we examine whether the strength of this relationship varies with the inflation rate. Using five-year averages of standard measures of financial development, inflation, and growth for 84 countries from 1960 to 1995, a series of rolling panel regressions show that there is an inflation threshold for the finance-growth relationship that lies between 13 and 25 percent. When inflation exceeds the threshold, finance ceases to increase economic growth. We also find that the level of financial depth varies inversely with inflation in low-inflation environments and that disinflation is associated with a positive effect of financial depth on growth.
Author: Hakan Yilmazkuday
Publisher:
ISBN:
Category : Electronic book
Languages : en
Pages :
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Book Description
Author: Mr.Jean-Louis Arcand
Publisher: International Monetary Fund
ISBN: 1475526105
Category : Business & Economics
Languages : en
Pages : 50
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Book Description
This paper examines whether there is a threshold above which financial development no longer has a positive effect on economic growth. We use different empirical approaches to show that there can indeed be "too much" finance. In particular, our results suggest that finance starts having a negative effect on output growth when credit to the private sector reaches 100% of GDP. We show that our results are consistent with the "vanishing effect" of financial development and that they are not driven by output volatility, banking crises, low institutional quality, or by differences in bank regulation and supervision.
Author: Alexandre Corhay
Publisher:
ISBN:
Category :
Languages : en
Pages :
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Author: Ibrahim Raheem
Publisher:
ISBN:
Category :
Languages : en
Pages : 9
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Book Description
The study examined a nonlinear relationship between inflation and growth through financial development using data for Nigeria, Ghana and Cote d'Ivoire for periods between 1970 and 2010. The threshold value of inflation that could ensure positive association in the finance-growth nexus was empirically determined. Our results confirmed the existence of threshold with estimates that suggest that the threshold level of inflation is between 5% and 10% per annum for Ghana, and 15% per annum for Nigeria and Cote d' Ivoire.
Author: Hakan Yilmazkuday
Publisher:
ISBN:
Category :
Languages : en
Pages : 23
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Book Description
Although the relationship between financial development and growth is almost obvious, the effect of inflation on the finance-growth nexus is still a subject of debate. In particular, what is the optimal rate of inflation for long-run growth? To answer this question, I analyze the relation between finance, inflation and growth by using a semiparametric graphical approach. I find that the optimal level of inflation that leads to higher long-run growth rates is around 10 percent. I also show that the positive effects of low inflation on growth are more apparent when there are high levels of financial depth. Finally, when both the levels of inflation and financial depth are low, the growth rate of the economy is volatile.
Author: Aynalem Shita
Publisher: LAP Lambert Academic Publishing
ISBN: 9783848481712
Category :
Languages : en
Pages : 88
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Book Description
Over the past few decades, the nexus between inflation and economic growth have drawn extensive attention of macroeconomists, policy makers and the central bankers of both developed and developing countries. Much less agreement exists about the precise relationship between inflation and economic performance. This book has reviewed briefly theoretical and empirical findings about the relationship between inflation and economic growth. Moreover, the writer has examined the inflation - investment relationship to assess whether investment is the channel through which inflation and economic growth are related. More specifically, this book has examined their relationship using co-integration and error correction models accompanying with correlation matrix and Granger Causality test for the case of Ethiopia. This analysis should help shed some light on the nexus between inflation and economic growth especially to University students, professionals and policy makers in the area
Author: Stephanie Kremer
Publisher:
ISBN: 9783941240032
Category :
Languages : en
Pages : 36
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Book Description
Author: World Bank
Publisher: World Bank Publications
ISBN: 1464806845
Category : Business & Economics
Languages : en
Pages : 184
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Book Description
World Development Indicators 2016 provides a compilation of relevant, high-quality, and internationally comparable statistics about global development and the fight against poverty. It is intended to help policymakers, students, analysts, professors, program managers, and citizens find and use data related to all aspects of development, including those that help monitor progress toward the World Bank Group’s two goals of ending poverty and promoting shared prosperity. Six themes are used to organize indicators—world view, people, environment, economy, states and markets, and global links. WDI 2016 includes: •A selection of the most popular indicators across 214 economies and 14 country groups organized into six WDI themes •A new section on the Sustainable Development Goals (SDGs) has replaced the one on Millennium Development Goals (MDGs). •The SDG section covers all 17 goals, and important targets to achieve these goals. Each goal has been presented in a maximum 2-page spread with selected indicators to explain the targets. •Each of the remaining sections includes an introduction, a map, a table of the most relevant and popular indicators for that theme together with a discussion of indicator compilation methodology. •A user guide describing resources available online and on mobile apps. Download the WDI DataFinder Mobile App and other Data Apps at data.worldbank.org/apps. WDI DataFinder is a mobile app for browsing the current WDI database on smartphones and tablets, using iOS and Android, available in four languages: English, French, Spanish, and Chinese. Use the app to: •Browse data using the structure of the WDI •Visually compare countries and indicators •Create, edit, and save customized tables, charts, and maps •Share what you create on Twitter, Facebook, and via email
