Credit vs. payment services: financial development and economic activity revisited

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The purpose of this paper is to assess whether the banking system, over and beyond its credit function, has a significant impact on per capita GDP by providing means of payment. An annual database of 152 spanning the 1980-2007 period is exploited to this end. On the descriptive front, we find that r...

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Autores principales:	Bebczuk, Ricardo Néstor, Burdisso, Tamara, Sangiácomo, Máximo
Formato:	Objeto de conferencia
Lenguaje:	Inglés
Publicado:	2010
Materias:	Ciencias Económicas banking system GDP per capita means of payment
Acceso en línea:	http://sedici.unlp.edu.ar/handle/10915/170445
Aporte de:	SEDICI (UNLP) de Universidad Nacional de La Plata

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spelling	I19-R120-10915-1704452024-09-20T20:43:44Z http://sedici.unlp.edu.ar/handle/10915/170445 Credit vs. payment services: financial development and economic activity revisited Bebczuk, Ricardo Néstor Burdisso, Tamara Sangiácomo, Máximo 2010-11 2010 2024-09-20T16:34:49Z en Ciencias Económicas banking system GDP per capita means of payment The purpose of this paper is to assess whether the banking system, over and beyond its credit function, has a significant impact on per capita GDP by providing means of payment. An annual database of 152 spanning the 1980-2007 period is exploited to this end. On the descriptive front, we find that richer economies display higher and increasing levels of demand deposits and lower levels of currency than poor countries. While this was to be expected, more surprising is the fact that the currency to GDP ratio did not diminish much over time, regardless of income level differences. In turn, our regressions confidently support the hypothesis that banks contribute to economic development not only as credit suppliers but also by facilitating transactions. Specifically, along with the ratio of private credit to GDP, the volume of demand deposits to GDP appears to exert a positive influence on per capita GDP. On the contrary, the level of currency to GDP yields a negative loading. The results are robust to different model specifications and endogeneity tests. These findings have valuable implications for a better understanding of the channels through which the banking system affect the economy. Facultad de Ciencias Económicas Objeto de conferencia Objeto de conferencia http://creativecommons.org/licenses/by-nc-sa/4.0/ Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International (CC BY-NC-SA 4.0) application/pdf
institution	Universidad Nacional de La Plata
institution_str	I-19
repository_str	R-120
collection	SEDICI (UNLP)
language	Inglés
topic	Ciencias Económicas banking system GDP per capita means of payment
spellingShingle	Ciencias Económicas banking system GDP per capita means of payment Bebczuk, Ricardo Néstor Burdisso, Tamara Sangiácomo, Máximo Credit vs. payment services: financial development and economic activity revisited
topic_facet	Ciencias Económicas banking system GDP per capita means of payment
description	The purpose of this paper is to assess whether the banking system, over and beyond its credit function, has a significant impact on per capita GDP by providing means of payment. An annual database of 152 spanning the 1980-2007 period is exploited to this end. On the descriptive front, we find that richer economies display higher and increasing levels of demand deposits and lower levels of currency than poor countries. While this was to be expected, more surprising is the fact that the currency to GDP ratio did not diminish much over time, regardless of income level differences. In turn, our regressions confidently support the hypothesis that banks contribute to economic development not only as credit suppliers but also by facilitating transactions. Specifically, along with the ratio of private credit to GDP, the volume of demand deposits to GDP appears to exert a positive influence on per capita GDP. On the contrary, the level of currency to GDP yields a negative loading. The results are robust to different model specifications and endogeneity tests. These findings have valuable implications for a better understanding of the channels through which the banking system affect the economy.
format	Objeto de conferencia Objeto de conferencia
author	Bebczuk, Ricardo Néstor Burdisso, Tamara Sangiácomo, Máximo
author_facet	Bebczuk, Ricardo Néstor Burdisso, Tamara Sangiácomo, Máximo
author_sort	Bebczuk, Ricardo Néstor
title	Credit vs. payment services: financial development and economic activity revisited
title_short	Credit vs. payment services: financial development and economic activity revisited
title_full	Credit vs. payment services: financial development and economic activity revisited
title_fullStr	Credit vs. payment services: financial development and economic activity revisited
title_full_unstemmed	Credit vs. payment services: financial development and economic activity revisited
title_sort	credit vs. payment services: financial development and economic activity revisited
publishDate	2010
url	http://sedici.unlp.edu.ar/handle/10915/170445
work_keys_str_mv	AT bebczukricardonestor creditvspaymentservicesfinancialdevelopmentandeconomicactivityrevisited AT burdissotamara creditvspaymentservicesfinancialdevelopmentandeconomicactivityrevisited AT sangiacomomaximo creditvspaymentservicesfinancialdevelopmentandeconomicactivityrevisited
_version_	1824075656931049472

Credit vs. payment services: financial development and economic activity revisited

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