Finance and Balanced Growth

Alex William Trew

Finance and Balanced Growth

Alex William Trew

Research output: Working paper

Abstract

The Uzawa (1961) theorem applied to finance and growth suggests that a long-run positive correlation between financial efficiency and depth is only present when variations in the extent of access to financial services are considered. Improvements in financial efficiency can lead to new capital augmenting technologies along the balanced path, but only improvements in financial efficiency directed towards labor can change the rate of growth in the long-run. These findings suggest ways to understand some of the more nuanced relationships between finance and growth observed in the data and point in a number of directions for future research.

Original language	English
Publication status	Published - Jul 2010

Publication series

Name	Centre for Dynamic Macroeconomic Analysis, Working Paper
No.	1012

Cite this

@techreport{e2e60944c0304e00897b8566c3eb61dc,

title = "Finance and Balanced Growth",

abstract = "The Uzawa (1961) theorem applied to finance and growth suggests that a long-run positive correlation between financial efficiency and depth is only present when variations in the extent of access to financial services are considered. Improvements in financial efficiency can lead to new capital augmenting technologies along the balanced path, but only improvements in financial efficiency directed towards labor can change the rate of growth in the long-run. These findings suggest ways to understand some of the more nuanced relationships between finance and growth observed in the data and point in a number of directions for future research.",

author = "Trew, \{Alex William\}",

note = "Revision resubmitted at Macroeconomic Dynamics",

year = "2010",

month = jul,

language = "English",

series = "Centre for Dynamic Macroeconomic Analysis, Working Paper",

number = "1012",

type = "WorkingPaper",

}

TY - UNPB

T1 - Finance and Balanced Growth

AU - Trew, Alex William

N1 - Revision resubmitted at Macroeconomic Dynamics

PY - 2010/7

Y1 - 2010/7

N2 - The Uzawa (1961) theorem applied to finance and growth suggests that a long-run positive correlation between financial efficiency and depth is only present when variations in the extent of access to financial services are considered. Improvements in financial efficiency can lead to new capital augmenting technologies along the balanced path, but only improvements in financial efficiency directed towards labor can change the rate of growth in the long-run. These findings suggest ways to understand some of the more nuanced relationships between finance and growth observed in the data and point in a number of directions for future research.

AB - The Uzawa (1961) theorem applied to finance and growth suggests that a long-run positive correlation between financial efficiency and depth is only present when variations in the extent of access to financial services are considered. Improvements in financial efficiency can lead to new capital augmenting technologies along the balanced path, but only improvements in financial efficiency directed towards labor can change the rate of growth in the long-run. These findings suggest ways to understand some of the more nuanced relationships between finance and growth observed in the data and point in a number of directions for future research.

UR - http://ideas.repec.org/p/san/cdmawp/1012.html

M3 - Working paper

T3 - Centre for Dynamic Macroeconomic Analysis, Working Paper

BT - Finance and Balanced Growth

ER -

Finance and Balanced Growth

Abstract

Publication series

Other files and links

Fingerprint

Finance and balanced growth

Cite this