| Abstract: |
This paper provides new evidences on traditional finance-growth nexus via
dividing financial services into intermediation and non-intermediation
services and examines their relationships with economic growth. Applying time
series cointegration techniques and Granger causality tests for eight OECD
countries, several results are obtained. First, there exists a long-run
equilibrium relationship among economic growth, intermediation activities, and
non-intermediation activities in Austria, France, and Korea. Second, we find
that financial intermediation services promote long-run economic growth in
France and Korea, whereas non-intermediation services impede Austria?s
long-term economic growth. Finally, the development of non-intermediation
activities leads the development of intermediation activities in France and
the Netherlands in the short-term. This paper emphasizes the importance of
non-intermediation activities in the growth process and in the development of
intermediation services as well. |