Identification of Financial Sector Optimal Depth and Structure from the Perspective of Economic Growth, Macroeconomic and Financial Stability

Mikhail Mamonov, Center for Macroeconomic Analysis and Short-term Forecasting
Renat Akhmetov, Center for Macroeconomic Analysis and Short-term Forecasting
Vera Pankova, Center for Macroeconomic Analysis and Short-term Forecasting
Oleg Solntsev, Center for Macroeconomic Analysis and Short-term Forecasting
Anna Pestova, Center for Macroeconomic Analysis and Short-term Forecasting
Artem Deshko, Center for Macroeconomic Analysis and Short-term Forecasting 

Citation: Mamonov, M., Akhmetov, R., Pankova, V., Solntsev, O., Pestova, A. and Deshko, A. (2018). Identification of Financial Sector Optimal Depth and Structure from the Perspective of Economic Growth, Macroeconomic and Financial Stability. Russian Journal of Money and Finance, 77(3), рр. 89-123.
doi: 10.31477/rjmf.201803.89 

Abstract
Tis paper attempts to estimate financial sector development targets which, other things being equal, provide for the best possible GDP performance while ensuring its growth sustainability along with price and financial stability. To address this task, the hypothesis of nonlinear relationship between GDP dynamics, its volatility, inflation, the frequency of financial crises, on the one hand and the development of key financial sector segments was tested. The study used a standard technique of panel data regression analysis, on the other hand employed in studies examining similar issues and a sample of 63 emerging and advanced economies covering 1980 – 2014. 

Keywords: optimal level, financial sector development, economic growth, economic growth rate volatility, price stability, financial stability, objective function
JEL Codes: C53, C82, E17

Abstract

This short report surveys main findings of a recent multi-country research effort within the IBRN network. 17 national teams used confidential supervisory bank-level data to study international transmission of monetary policy changes in systemic countries into bank lending to private non-financial borrowers worldwide. Two channels of transmission, the bank funding channel and asset rebalancing channel, are tested separately. The effect of monetary policy changes in the US on domestic lending is statistically significant in most specifications. The economic significance of the estimated effect is relatively higher for more financially open economies and emerging markets.

Keywords: monetary policy, international spillovers, cross-border transmission
JEL: E52, F34, G01, G21

article

appendix

× Закрыть