Report
Patrick Artus

The size of finance and growth

The consensus on the relationship between the size of finance and growth is that first, when the size of the finance is small, there is a positive relationship (financial development is good for growth), and then, once the size of finance becomes large, the relationship becomes negative (finance becomes bad for growth when it is too big). We examine the nature of this relationship between the size of finance and growth: For different definitions of finance (bank deposits, debt, all financial assets as a whole, employment in financial services); Drawing a distinction between OECD countries and emerging countries. Our analysis points to the conclusion that : For OECD countries, there is a negative correlation between the size of debt and growth; For emerging countries, there is a positive correlation between the size of bank deposits and growth.
Provider
Natixis
Natixis

Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.

 

Analysts
Patrick Artus

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