What Matters in the Finance-Growth Nexus of Developed Economies? Evidence from OECD Countries

Marc Steffen Rapp, Iuliia A. Udoieva

    Research output: Working paperResearch


    While the majority of empirical work examines growth effects of financial sector “size”, we provide evidence for the role of financial sector “structure”. Focusing on stock markets, we study OECD countries over the 1994-2013 period and find that relatively larger stock markets facilitate economic growth and mitigate economic risk. We find no such effect for private bond markets and private credit volume. Overall, our results suggest that financial sector “structure” matters for economic development of advanced economies highlighting the importance of addressing financial structure gaps.
    Original languageEnglish
    Place of PublicationNew York
    PublisherSSRN: Social Science Research Network
    Number of pages9
    Publication statusPublished - 2016
    SeriesMACIE Paper Series


    • Finance
    • Financial development
    • Stock market
    • Economic development
    • Growth

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