Does banking sector development promote economic growth? An empirical analysis for selected countries in Central and South Eastern Europe

By Mihail Petkovski, Jordan Kjosevski. 2014

150 citations recorded by the source corpus.

Economic growth is one of the ultimate goals of any economic system. This article examines the question whether in 16 transition economies from Central and South Eastern Europe the banking sector influences economic growth. The empirical investigation was carried out using a generalised method of moments (GMM) dynamic panel method. We measure the development in the banking sector using the bank credit to the private sector, interest rates, and ratio of quasi money (RQM). The research results show that credit to the private sector and interest margin (IM) are negatively related to the economic growth, while RQM is positively related to economic growth.

Subfields: Economics and Econometrics, Information Systems

View Paper: https://www.semanticscholar.org/paper/da8ecb290be51a659f757ebada50c36b2c0f3443

Citations in the corpus

• Economic growth and financial performance of Islamic banks: a CAMELS approach (2020, unknown): “IES 28,1 48 Thus, based on the endogenous growth model, when investments are increased due to the finance and banking performance that leads to higher economic growth (Petkovski and Kjosevski, 2014).”