FINANCIAL DEVELOPMENT AND ECONOMIC GROWTH: A PANEL CAUSALITY ANALYSIS FOR OECD COUNTRIES

Year 2019, Volume: 6 Issue: 2, 471 - 484, 29.08.2019

Seymur Ağazade , Aykut Karakaya

https://doi.org/10.30798/makuiibf.526723

Cited By: 7

Abstract

The relationship between financial development
and economic growth is expressed by different hypotheses. Demand pressure which
is caused by increased income as a conclusion of growth may lead to the
financial development. This argument is known as demand-following hypothesis.
On the contrary, the supply-leading hypothesis indicates that financial
development leads to increased efficiency and therefore promotes growth. The
feedback hypothesis implies that the causal relationship between financial
development and growth is bidirectional, whereas there is no causality in the
neutral hypothesis. This study examines the relationship between financial
development and economic growth in the case of 34 OECD countries. For this
purpose we estimate heterogeneous VAR model and conduct Dumitrescu and Hurlin
(2012) causality test which allows for dependency in panel units and
heterogeneity of parameters. Findings of causality test showed that there is a
bidirectional relationship. In VAR model that estimated for growth, parameters
of lagged financial development were found to be significant for 11 countries.
In financial development VAR model, lagged growth variable coefficients of 17
countries were significant. These findings support the feedback hypothesis for
OECD countries in financial development and economic growth relationship.

Keywords

Financial Development, Growth, Panel Causality Tests, OECD Countries

FİNANSAL GELİŞME VE EKONOMİK BÜYÜME: OECD ÜLKELERİ ÖRNEĞİNDE PANEL NEDENSELLİK ANALİZİ

Abstract

Finansal gelişme ile ekonomik büyüme arasındaki
nedensellik ilişkisi farklı hipotezlerle ifade edilmektedir. Ekonomik büyüme ve
gelir düzeyindeki artışın neden olduğu talep baskısı finansal sistemin
gelişmesine neden olabilir. Bu görüş talep takipli hipotez olarak bilinmekte-dir.
Bunun aksine, arz öncüllü hipotez finansal gelişmenin kaynak dağılımında
etkinlik artışı sağlamakla büyümeye neden olduğunu öngörür. Geri besleme
hipotezi finansal gelişme ve büyüme arasındaki nedensellik ilişkisinin çift
yönlü olduğunu ifade ederken, yansızlık hipotezinde ise herhangi bir
nedensellik ilişkisi söz konusu değildir. Bu çalışmada finansal gelişme ile
ekonomik büyüme arasın-daki ilişki 34 OECD üyesi ülke örneğinde incelenmiştir.
Çalışmada panel birimleri arasında bağımlılığa ve hete-rojenliğe izin veren
Dumitrescu ve Hurlin (2012) panel nedensellik analiz yapılmış ve heterojen VAR
modeli tahmin edilmiştir. Nedensellik testi sonuçları finansal gelişme ve
büyüme arasında çift yönlü ilişki olduğunu göstermiştir. Büyüme için tahmin
edilen VAR modelinde 11 ülke için gecikmeli finansal gelişme değişkenine ait
parametreler anlamlı bulunmuştur. Finansal gelişme VAR modellerinde ise büyüme
değişkeni gecikmeli değerine ait katsayıların 17 ülke için anlamlı olduğu
görülmüştür. Bu sonuçlar OECD ülkelerinde finansal gelişme ve ekonomik büyüme
ilişkisinde geri besleme hipotezinin geçerli olduğunu desteklemektedir.

Keywords

Finansal Gelişme, Büyüme, Panel Nedensellik, OECD Ülkeleri

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