Template-Type: ReDIF-Paper 1.0
Author-Name: Zhenxiong Li
Author-Name-First: Zhenxiong
Author-Name-Last: Li
Author-Name: Hilary Ingham
Author-Name-First: Hilary
Author-Name-Last: Ingham
Title: Financial Development, Economic Performance and Democracy
Abstract: This paper investigates the long-term effect of financial development on economic growth using annual data for 67 countries over the period 1971 to 2007.<br/>Both autoregressive distributed lag (ARDL) and cross-sectionally augmented autoregressive distributed lag (CS-ARDL) models are applied to count for crosscountry heterogeneity and error cross-country dependence. The results uphold a positive and significant effect of financial development on long-run per capita output. There is also some evidence of a non-linear relationship between financial development and growth. However, the analysis also reveals that the results<br/>derive primarily from non-democratic countries.
Creation-Date: 2020
File-URL: http://www.lancaster.ac.uk/media/lancaster-university/content-assets/documents/lums/economics/working-papers/LancasterWP2020_003.pdf
File-Format: application/pdf
Number: 291296033
Classification-JEL: O16, O43, P16
Keywords: Economic growth, Financial development, Democracy
Handle: RePEc:lan:wpaper:291296033