Table of contents alert
Do you want to receive an email alert about new issue?


Volume 62, Issue 4


Financial Development and Economic Growth in Poland in Transition: Causality Analysis

Gurgul, Henryk; Lach, Lukasz

Year: 2012   Volume: 62   Issue: 4   Pages: 347-367

Abstract: This study examines the causal relationship between economic growth and financial development in Poland on the basis of quarterly data for the period 2000 Q1–2011 Q4. In order to examine the impact of the 2008 financial crisis on the structure of financial sector-GDP links in Poland we performed the empirical research for the full period and the pre-crisis subsample (covering the period 2000 Q1–2008 Q3). The empirical research was performed in two variants: bank- and stock market-oriented approaches. The results obtained for the pre-crisis subsample suggest causality running from stock market development to economic growth and from economic growth to banking sector development. This implies that the direction of the causality strongly depends on which particular area of the financial sector is considered. When the crisis data was also taken into consideration the test results suggested that during the 2008 financial crisis the banking sector had a much more significant impact on economic growth than before the crisis. On the other hand, the positive causal impact of the performance of the WSE on economic growth in Poland was significant before 2008, while during the crisis significant negative shocks occurred. The empirical results for both periods examined were found to be robust to the type of control variable applied and the specification of the testing procedure, which clearly validates the major conclusions of this paper.

JEL classification: C32, O16, E44

Keywords: financial development, economic growth, transition economies, Granger causality


RePEc: http://ideas.repec.org/a/fau/fauart/v62y2012i4p347-367.html

pdf Attachment [PDF]    zip Data [ZIP]print Print   Recommend to others Recommend to others