This is a basic introduction on the money (or cash) generation applying the second law of thermodynamics. As the result of any economic process we observe an increase of the entropy of the magnitude of the value added. Based on this relation it is possible to calculate the necessary money...

This paper examines the effect of financial development on economic sophistication. We use domestic credit to private sectors and stock market liquidity variables to measure financial development and Economic Complexity Index to measure the economic sophistication. Using a panel data set of 97...

This paper provides evidence on the relationship between financial liquidity and economic growth. Using a panel data of 136 countries, we find that there exists a threshold above which the marginal effect of financial liquidity on economic growth becomes negative. In particular, the turning...

Banks perform various roles in the economy and are critical to both the financial system and the real economy. Situation of banks has changed when compare financial ratios before and after financial crisis. The paper presents the possibility of using euclidean distance from the Positive...

The paper assesses the impact of adding information on financial cycles on the output gap estimates for eight advanced economies using two unobserved components models: a reduced form extended Hodrick-Prescott filter, and a standard semi-structural unobserved components model. To complement...

Using a panel of five Asian economies - Indonesia, Korea, Malaysia, Singapore and Thailand - over the period 1995-2007 we analyze the links between firm survival and financial development. We find that traditionally used measures of financial development play an important role in influencing...

This paper illustrates that evaluating alternate abatement polices that affect the growth path of an economy on the basis of their effects on asset valuation may not be welfare enhancing. We show that the class of abatement polices considered in the integrated assessment literature are robust...

We propose a theory where capital market imperfections are at the origin of cross-country TFP differences. In our theory entrepreneurs have private information about the multifactor productivity of their technology. We study how the contracting environment, as described by the ability to enforce...

Utilizing Arellano and Bond (1991) panel-GMM estimator model, this paper investigates dynamic interactions between financial system, through bank/stock market development, and economic growth volatility in overall/specific country group levels for 47 developed/developing/transition countries...

It is well known fact that all good things, as also bad things, come to an end and business cycles pass through good and bad economic times. Economically 2010 was a year of transition from economic recession to recovery. Economies were improving in some countries and industries were showing...