Financial market integration and economic growth in the EU

Authors: Luigi Guiso¹; Tullio Jappelli²; Mario Padula³; Marco Pagano⁴

Source: Economic Policy, Volume 19, Number 40, October 2004 , pp. 523-577(55)

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Abstract:

SUMMARY EU finance and growth

The current diversity in the degree of financial development across the EU can be a great opportunity at a time where this area is poised to become increasingly financially integrated. Integration should accelerate the development of the most backward financial markets, and allow companies from these countries to access more sophisticated credit and security markets. In line with a large recent literature, it is reasonable to expect that financial integration will have a ‘growth dividend’ in Europe. This paper attempts to quantify this growth dividend, using both industry and firm-level data to estimate the empirical relationship between financial market development and growth, and to gauge how it will distribute itself across countries and sectors.

— Luigi Guiso, Tullio Jappelli, Mario Padula and Marco Pagano

Document Type: Research article

DOI: http://dx.doi.org/10.1111/j.1468-0327.2004.00131.x

Affiliations: 1: Università di Sassari, Ente ‘Luigi Einaudi’ and CEPR; 2: Università di Salerno, CSEF, and CEPR; 3: Università di Salerno and CSEF; 4: Università di Napoli Federico II, CSEF, and CEPR

Publication date: 2004-10-01