TY  - JOUR
AU  - Levine,Ross
TI  - Finance and Growth: Theory and Evidence
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 10766
PY  - 2004
Y2  - September 2004
UR  - http://www.nber.org/papers/w10766
L1  - http://www.nber.org/papers/w10766.pdf
N1  - Author contact info:
Ross Levine
Department of Economics
Brown University
64 Waterman Street
Providence, RI 02912
Tel: 401/863-2170
E-Mail: ross_levine@brown.edu
AB  - This paper reviews, appraises, and critiques theoretical and empirical research on the connections between the operation of the financial system and economic growth. While subject to ample qualifications and countervailing views, the preponderance of evidence suggests that both financial intermediaries and markets matter for growth and that reverse causality alone is not driving this relationship. Furthermore, theory and evidence imply that better developed financial systems ease external financing constraints facing firms, which illuminates one mechanism through which financial development influences economic growth. The paper highlights many areas needing additional research.
ER  -