nep-fdg New Economics Papers
on Financial Development and Growth
Issue of 2006‒05‒20
four papers chosen by
Iulia Igescu
Global Insight, GmbH

  1. Financial integration, GDP correlation and the endogeneity of optimum currency areas By Stefano Schiavo
  2. Wage and employment in a finance-led economy. By Célia Firmin
  3. Regional Evidence on the Finance-Growth Nexus By Andrea Vaona
  4. Where is the Cuban economy heading ?. By Rémy Herrera

  1. By: Stefano Schiavo (University of Trento)
    Abstract: The paper analyzes the relationship between trade, financial integration and business cycle synchronization in the euro area. The introduction of the euro has had a noticeable impact on European financial markets: we find evidence that capital markets integration exerts a positive effect on output correlation. This in turn has two major implications. First, it corroborates the hypothesis of the endogeneity of optimum currency areas, whereby after joining a monetary union countries fit better standard OCA criteria; second, it provides European policymakers with yet another reason to purse financial integration in the euro area (and in prospective members as well).
    Keywords: business cycle; EMU; endogeneity; integration; optimum currency areas;
    JEL: E32 E44 F36
    Date: 2005–09
  2. By: Célia Firmin (Centre d'Economie de la Sorbonne)
    Abstract: The object of this paper is to analyse the links between income distribution and growth in a finance-led economy, with a post Keynesian "stock-flow" macroeconomic model. In fact, the increased share of financial activities creates a new macroeconomic and income distribution dynamic. We will use the steady-state case and simulations experiments to analyse model reaction to a change in financial key parameter when the wage share is endogeneous.
    Keywords: Financialization, labor's share, capital accumulation, simulations experiments.
    JEL: E12 E24 E44 E51
    Date: 2006–03
  3. By: Andrea Vaona (Dipartimento di Scienze economiche (Università di Verona))
    Abstract: The Finance-Growth Nexus is a classical source of debate among economists. This contribution o¤ers regional evidence on this issue in order to see if it can meet the data within a 140 years old economic union –Italy -, in the ideal context for its main competitor - New Economic Geography - and in order to avoid pooling between developed and developing countries. The results for this application support the view that …nance leads growth, reject its possible endogeneity and shows its robustness even in presence of spatial unobserved heterogeneity.
    Keywords: Finance, Growth, Regions
    JEL: O18 O16 C31
    Date: 2005–12
  4. By: Rémy Herrera (Centre d'Economie de la Sorbonne)
    Abstract: This article is the introduction of an issue (to be published) of the U.S. review International Journal of Political Economy on the Cuban economy, and coordinated by Rémy Herrera. It deals with the progresses, but also with the deficiencies, of the Cuban revolution in the economic field, until the recent de-dollarization. It underlines its economic challenges at the beginning of the XXIst century, as well as its internal forces and its external opportunities facing these challenges.
    Keywords: Development, socialism, revolution, growth, de-dollarization, social expenditure.
    JEL: J43 J71 N36 N40 O10 O13 O54 P16 P51
    Date: 2006–04

This nep-fdg issue is ©2006 by Iulia Igescu. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.