This chapter examines the direction of causality between financial development and economic growth in 44 developed and developing countries for the period of 1965-2016. Using bank-based indicators, our empirical results provide the evidence of linear Granger-causality running from economic...

There has been intensive research in the literature of macroeconomics examining the nexus between finance, capital movements, and economic growth to explore the impact of each variable on other variables in the system. One might claim that these researches, needless to say, are seminal and have...