engleski

The impact of financial markets on the economic growth of the new European Union (EU) countries: A panel cointegration analysis

This paper establishes the relationship between the development of the financial system and economic growth of a country expressed as gross domestic product (GDP) per capita. In doing so, the emphasis is placed on identifying the significant variables and their impact. Empirical research is based on panel cointegration analysis that utilizes annual data on real GDP per capita, consumer price index, money and quasy money as % of GDP, domestic credit provided by financial sector as % of GDP and market capitalisation of listed companies as % of GDP from 1995 to 2014 for 12 new European Union (EU) countries. The long-run results suggest that consumer price index, money and quasy money and domestic credit provided by the financial sector generally have negative and almost insignificant impact on real GDP while market capitalisation has a significant and positive impact on real GDP. on the other side, the short-run results indicate that changes in prices and market capitalisation are insignificant while changes in money and quasy money have negative and significant impact on changes in real GDP. Finally, changes in domestic credit provided by the financial sector have positive and significant impact on changes in real GDP.

economic growth ; financial development ; new EU countries ; panel cointegration analysis

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