This paper addresses heterogeneity in determinants of economic growth in a data-driven way. Instead of defining groups of countries with different growth characteristics a priori, based on, for example, geographical location, we use a finite mixture panel model and endogenous clustering to...

To clarify the causal links between financial activity and economic growth, a series of path models is estimated for a pooled sample of 93 countries between 1970 and 1990. A multi-wave 2SLQ-analysis shows that during the 1970's and 1980's finance was predominantly a supply-leading determinant of...