金融发展、经济增长和金融创新外文翻译2019

原文

The Missing-Link between Financial Development and Economic Growth: Financial

Innovation

Ebubekir Mollaahmetoglu, Burcay YasarAkcal

Abstract

The paper investigates the relationship between financial development, financial innovation, and economic growth using a panel data analysis. The sample covers fifteen countries for the period of 2003-2016. Financial development has been considered as a composite variable consisting of four components: financial access, financial depth, financial efficiency, and financial stability. The distinguishing feature of the paper is that it includes financial innovation as another component of financial development in addition to the cited four. We find statistically significant and positive relationship between financial innovation and economic growth (The higher the number of financial innovation, the higher the rate of economic growth). The paper concludes that both financial development and financial innovation have significant impact on economic growth.

Keywords：Financial Development，Financial Innovation，Economic Growth，Panel Data

1 Introduction

Liberalization movements and technological developments are a standout amongst the most significant components influencing the advancement of development of innovation. Along with the innovation and diversification of financial products has broadened the risk preferences, widespread use led to the growth of the market, especially in the 1960s. Many multidimensional studies have been carried out about relationship, and direction and boundaries of the relation, between financial development and economic growth on the basis of developing and advanced countries.

Schumpeter (1912), in “The theory of Economic Development”, outlined that economic development is ginger up by innovation within financial intermediaries.

Therewithal, Schumpeter (1912) highlighted the role of banks in promoting innovation due to banks identify and support the enterprises at implementing the innovations. Levine, (1997) and Mishra, (2008) stressed that a well- developed and functioning financial system can advance economic growth by enabling economic agents to diversify and expand their portfolios and meet their liquidity requirements. Financial innovations lead to a higher level of savings and capital accumulation, consequently, a higher level of economic growth. McKinnon and Shaw (1973) put forward the financial repression hypothesis and emphasized that the liberalization of capital flows, interest rates, and credit facilities will increase effective resource allocation and savings and this in turn will transform into investments. These changes will promote economic growth. With channelling financial resources from informal financial markets to formal financial markets, in other words, transferring of idle funds and internal savings to the financial sector will promote gross savings in the economies. According to Levine (1997), via technological change and capital accumulation, financial systems yield in economic growth. Affected capital accumulation by the financial system is due to alteration of the savings rate or re-allocation of savings. Better financial systems activate and mobilize savings and facilitate efficient allocation of resources (Greenwood et al., 2010, King and Levine, 1993). Also, different approach were put forward in these issues such as financial development may lead to high systemic risk. (Gai et al., 2008, Gennaioli et al., 2012).

In a well-functioning financial system, thanks to new technologies and entrepreneurs, in a greater number of increased financial instruments and product diversity with financial institutions and organizations, widespread use of financial instruments and it’s channels, mobilization of improving resources through savings and ensuring the efficiency trigger off investments and the realization of economic growth and increase in productivity in real sector.

Many variables are used in the previous literature as indicators of financial development. However, variables representing financial development need to be organized systematically. Cihak et.all, (2012), developed several measures of four characteristics of financial institutions and markets and financial development

variables were categorized as access (degree to which individuals can and do use financial institutions and markets), depth (size of financial institutions and markets), efficiency (efficiency of financial institutions and markets in providing financial services) and stability (stability of financial institutions and markets). Financial innovation was included by considering as a new internal dynamics of financial development in this analysis.

Financial innovation defined as “the act of crafting and, then, popularizing new financial instruments, technologies, institutions, markets, processes and business models including the new application of existing ideas in a different market context” and concept of financial innovation used in the study, as an ongoing research and development for new products, services or ideas (Tufano, 2003), (Lerner and Tufano, 2011). When defining financial innovation, according to where innovation occur, the usual approach is to categorize it into three groups (Vargas, 2007), process innovation (new production processes that allow the provision of new or existing financial products and services), organizational innovation (establishing new institutions or organizational structures within institutions where the production process is held), product innovations (creation of new products or services to meet market needs) In view of the discussion in literature, this study investigates the new and existing links between financial development and economic growth. However, this paper differs from the existing literature because of using financial innovation as a new link between the relation financial development and growth. In this research, financial development was considered with four different dimensions categorized as financial depth, efficiency, stability and access shown on the Figure 1. There are several studies on research and development expenditure though they rarely focus on financial research and development expenditure. On that sense, this study is different from the previous studies by take into account of financial research and development expenditure by analysing impact on economic growth. By using the annual data accessed and collected from fourteen countries for the period of 2003-2016, functionality of the real sector and financial sector were analyzed through panel data analysis by including the financial innovation variable.

This paper will proceed as follows. Literature review will be in Section II, Section III provides the data methodology and empirical works and results.

2 Literature Review

With the evolvement of financial innovation in modern economies recently, discussions about pro and cons of financial innovation arouse in this field. Bara & Mudzingiri (2016) established the causal relationship between financial innovation and economic growth in Zimbabwe with financial time series data for the period 1980-2013, and find that financial innovation has a relationship to economic growth that varies depending on the variable used to measure financial innovation. A long-run, growth-driven financial innovation confirmed, with causality running from economic growth to financial innovation. Bi-directional causality also exists after conditionally netting-off financial development. Beck, Chen, Lin, & Song, (2016) use research and development expenditure data for financial intermediation industry as Financial Innovation proxy. OLS and also GMM estimators are used on bank, industry and country level data for 32 countries. They conclude that positive and significant relationship exists between, global growth opportunities of a country and higher level of financial innovation and GDP growth. As a result of study, they find evidence supporting pro and cons of financial innovation. Azimova & Mollaahmetoglu (2017) investigated the impact of financial innovation and services on savings and domestic savings building panel data analysis using twenty countries data for the period of 2005-2014. They conclude that level of financial innovation and financial access are important parameters affecting both gross savings and gross domestic savings. DeYounget al. (2007) noted evidence that financial innovation increases bank growth and in that way supports financial deepening. Laeven et. all, (2015) built Schumpeterian model where entrepreneurs earn profits by inventing better goods and profit-maximizing financiers arise to screen entrepreneurs. It predicts that technological innovation and economic growth eventually stop unless financiers innovate and suggest that regulations that stymie financial innovation can have an enduring, adverse impact on economic growth. On the other hand, Henderson and Pearson (2010) show that financial institutions engineered financial products that

exploited investors’ misunderstanding of the payoffs to these products. And, Allen and Carletti (2006) presciently warned that financial innovations such as securitization that transfer credit risk can hinder the effective screening of borrowers, boosting financial fragility. Financial innovations such as securitization change the ex-ante incentives of financial intermediaries to carefully screen and monitor the borrowers.

The thought that research and development investments play an important role in the process of economic growth is extensive in literature. There are several studies on research and development expenditure though they rarely focus on financial research and development expenditure. Inekwe (2014), examined the role of research and development spending on economic growth for the period of 2000-2009 in the developping economies. By using dynamic system GMM, pooled mean group and three stage least square-GMM models, they found that the effect of research and development spending on growth is positive for upper middle-income economies while insignificant in lower income economies. Akcali and Sismanoglu (2015) analysed relation between research and development expenditures and economic growth using panel data analysis for 19 countries and from 1990 to 2013. Freimane and Bali?a (2016), investigated the empirical relationship between research and development research and development expenditures and economic growth in the European Union member states in the period of 2000–2013 with panel data regressions. The results show a statistically significant impact of research and development expenditures on the economic growth in the EU countries. Gumus and Celikay (2015) analysed the relation of research and development expenditure and contribution to the economic growth with comparing developed and developing countries. According to result; “research and development expenditure has a positive and significant effect on economic growth for all countries in the long run, but for developing countries the effect is weak in the short run but strong in the long run.” Some studies used patent data representing innovation. Hasan and Tucci (2010), using global patent data, investigated link innovation to economic growth based on a sample of 58 countries for the period 1980-2003. Their results indicate that countries hosting firms with higher quality patents also have higher economic growth and those

countries that increase the level of patenting also witness a concomitant increase in economic growth.

There are also many studies focus on relation between financial development and economic growth. Ductor & Grechyna (2015) analysed the interdependence between financial development and real sector output and the effect on economic growth. Using panel data for 101 developed and developing countries over the period 1970 to 2010, the effect of financial development on growth becomes negative, if there is rapid growth in private credit not accompanied by growth in real output. Pradhan et. All (2018) employed panel unit root and panel cointegration tests to determine the interactions between innovation, financial development, and economic growth in 49 European countries between 1961 and 2014. Their results indicate that there is the presence of a long-run equilibrium relationship between innovation, financial development, and per capita economic growth. Ciftci et all. (2016) is estimated long-run relationship for a panel of 40 countries over the period 1989–2011. They suggest that fostering the development of a country’s financial sector, economic growth will be accelerated.

3 Methodology

We employed panel data methodology to predict the effect of financial innovation on economic growth with financial development indicators. Panel data, have several advantages over cross-sectional or time-series data as it combines but it poses also a number of challenges. Main disadvantages of using panel data is difficulty of compiling the values of different units for the same variable and for the same time period. Cerna (2008) lists the the advantages of the panel data analysis as, “it reduces the multi-co-linearity phenomenon of the variables, increases the number of the freedom levels and, implicitly, the power of tests, therefore the trust level in the obtained outcomes, permits the construction and testing of certain behavioural templates more complex than the templates based on the analysis of the time serials or cross section structures, and permits a better analysis of the dynamics of the structural adjustments”.

3.1Data and Variables

The sample covers yearly data from 2003 to 2016 for a sample of 15 high-income and upper-income economies (Australia, Austria, Belgium, Canada, China, Czech, Germany, Italy, Japan, Mexico, Norway, Portugal, Spain, Turkey, and United States).

The dependent variable is GDP growth (annual %) and explanatory variables are gross savings (% of GDP) and financial system deposits to GDP (%). The most challenging point in the paper was to find data related to financial innovation. We obtain financial research and development expenditure data from Analytical Business Enterprise Research and Development database (ANBERD) of the OECD. For the development of the financial sector, we use measure of domestic credit to private sector (% of GDP) variable represents financial depth, loans from non-resident banks (net) to GDP (%)variable represents financial access, bank overhead costs to total assets (%) variable represents financial efficiency and stock price volatility variable represents stability. Table 1 summarizes all variables and their sources.

N is number of observations from 15 selected countries during period 2003–2016. Variable, financial system deposits to GDP (%) is, calculated using the deflation method, demand, time and saving deposits in deposit money banks and other financial institutions as a share of GDP. Another variable, bank overhead costs to total assets (%) is value of a bank's overhead costs as a share of its total assets. Stock price volatility is the variable that take average of the 360-day volatility of the national stock market index. Loans from nonresident banks (net) to GDP (%) is ratio of net offshore bank loans to GDP. And domestic credit to private sector variable refers to financial resources provided to the private sector (Global Financial Development Database, 2019).

To decide between pooled OLS and fixed effects model or random effects model, we applied a LR and F test. LR test on the table 3 below shows that there is individual or time effects in the model. As we retest individual or time effect separately, According to LR Test result in the first column there is individual or time effects for both models. F test separately test the time and individual effects; second column shows that there is individual effect and third column test result shows that there is no

time effect.

3.2 Findings

The fixed effects model with Driscoll and Kraay standard errors are appropriate for model due to models are heteroscedastic, auto-correlated up to a certain degree and possibly correlated with other groups. The robust estimation, fixed effects model with Driscoll and Kraay standard errors, presented table 2.

We estimate a fixed effect model to analyse the interaction among variables. The empirical results on financial development are also consistent with the previous studies. According to the model the overall regression results are significant at 1 percent significance level (F test) and the R-squared coefficient indicates that financial development explains about 49% of the GDP growth in countries used in the model.

We find statistically significant and positive relation between our new link financial innovations on the economic growth. This indicates that higher financial innovation is related with higher macroeconomic growth. The findings indicates that as a variable representing financial depth, domestic credit to private sector has a positive effect on economic growth while stock price volatility, represents financial stability, and volatility and Loans from non- resident banks (net) to GDP (%) has an negative effect. This findings are strongly parallel with former studies. Explanatory variables, financial system deposits to GDP and Gross Savings, are highly significant and positive effect on economic growth, which constitute the bridge between the financial development and economic growth as mentioned in the first section.

4 Conclusion

This paper examines the effect of financial innovation on economic growth as another link alongside financial development represented with financial access, depth, efficiency and stability variable. By using the available data on the annual basis, collected from 15 countries for the period 2003-2016, the new and existing links between financial development and economic growth, have been analyzed through panel data analysis. Due to scarcity data of financial innovation time series for countries, this study could not extended a distinct model for each country and panel

data approach was employed.

Unlike previous studies, financial development was considered with four different dimensions categorized as financial access, depth, efficiency and stability, and the financial innovation variable was included by considering as a new internal dynamics of financial development in the analysis.

This paper empirically supports that financial innovation is another important link near financial development that leads economic growth. We find statistically significant and positive relation between our new link financial innovation and economic growth, indicates that higher financial innovation is related with higher macroeconomic growth. The results are mostly parallel with theoretical and empirical findings of previous studies.

译文

金融发展与经济增长之间的重要环节：金融创新

Ebubekir Mollaahmetoglu，Burcay YasarAkcal

摘要

本文使用面板数据分析研究了金融发展，金融创新和经济增长之间的关系。该样本涵盖了2003-2016年的15个国家。金融发展被认为是一个包含四个部分的综合变量：金融获取，金融深度，金融效率和金融稳定性。本文的区别在于，除了上述四个方面，它还包括金融创新作为金融发展的另一个组成部分。我们发现，金融创新与经济增长之间存在统计上显着的正相关关系（金融创新率越多，经济增长率越高）。本文的结论是，金融发展和金融创新都对经济增长产生重大影响。

关键词：金融发展，金融创新，经济增长，面板数据

1引言

自由化运动和技术发展是影响创新发展的最重要因素之一。随着金融产品的创新和多样化拓宽了风险偏好，广泛使用导致了市场的增长，尤其是在1960年代。在发展中国家和发达国家的基础上，已经进行了许多关于金融发展与经济增长之间的关系，关系的方向和边界的多维研究。

熊彼特（Schumpeter，1912）在“经济发展理论”中概述了经济发展是金融中介机构内部创新的推动。因此，熊彼特（1912）强调了银行在促进创新中的作用，这归因于银行识别并支持企业实施创新。Levine（1997）和Mishra（2008）强调，完善的金融体系可以通过使经济主体多样化和扩展其投资组合并满足其流动性要求来促进经济增长。金融创新导致更高水平的储蓄和资本积累，因此，更高水平的经济增长。McKinnon和Shaw（1973）提出了金融抑制假说，并强调资本流动，利率和信贷便利的自由化将增加有效的资源分配和储蓄，进而将其转化为投资。这些变化将促进经济增长。换句话说，通过将金融资源从非正式金融市场转移到正式金融市场，将闲置资金和内部储蓄转移到金融部门将促进经济体的总储蓄。根据莱文（1997）的说法，通过技术变革和资本积累，金融体系可以促进经济增长。金融系统影响的资本积累是由于储蓄率的改变或储蓄的重新分配。更好的金融体系可以激活和动员储蓄，并促进资源的有效分配（Greenwood等，2010；King and Levine，1993）。此外，在这些问题上提出了不同的方法，例如金融发展可能导致高系统风险（Gai等，2008；Gennaioli等，2012）。

在运作良好的金融体系中，得益于新技术和企业家的支持，更多的金融工具和与金融机构和组织的产品多样化，金融工具及其渠道的广泛使用，通过储蓄动员改善资源并确保效率会触发投资，实现经济增长并提高实际部门的生产率。

在以前的文献中，许多变量被用作金融发展的指标。但是，代表金融发展的变量需要系统地组织。Cihak等人（2012年）开发了几种衡量金融机构和市场四个特征的方法，并将金融发展变量分类为：访问（个人可以和确实使用金融机构和市场的程度），深度（金融机构的规模和规模）。效率（金融机构和市场在提供金融服务方面的效率）和稳定性（金融机构和市场的稳定性）。在此分析中，金融创新被视为金融发展的新内部动力。

金融创新被定义为“制定并随后普及新的金融工具，技术，机构，市场，流程和商业模式的行为，包括在不同的市场环境中对现有思想的新应用”和研究中使用的金融创新概念，作为对新产品，服务或想法的持续研究和开发（Tufano，2003年）（Lerner和Tufano，2011年）。在定义金融创新时，通常根据创新发生的位置将其分为三类（Vargas，2007年），流程创新（允许提供新的或现有金融产品和服务的新生产流程），组织创新（在举行生产过程的机构内建立新机构或

组织结构，进行产品创新（创建新产品或服务以满足市场需求）

鉴于文献中的讨论，本研究调查了金融发展与经济增长之间的新的和现有的联系。但是，由于将金融创新用作金融发展与增长之间的新联系，因此本文与现有文献有所不同。在本研究中，金融发展被认为具有四个不同的维度，如图所示，分别是金融深度，效率，稳定性和获取性。虽然很少关注金融研究与开发支出，但有几项研究与开发支出的研究。从这个意义上讲，本研究与以往的研究有所不同，它通过分析对经济增长的影响来考虑金融研究和发展支出。通过使用从14个国家/地区收集并收集的2003-2016年年度数据，通过面板数据分析（包括金融创新变量）对实体部门和金融部门的功能进行了分析。

本文将进行如下操作。文献综述将在第二节，第三节中提供数据方法论以及实证工作和结果。

2文献综述

随着近代经济中金融创新的发展，在这一领域引起了关于金融创新利弊的讨论。Bara＆Mudzingiri（2016）利用1980-2013年期间的金融时间序列数据建立了津巴布韦金融创新与经济增长之间的因果关系，发现金融创新与经济增长之间的关系随用于衡量的变量而变化金融创新。长期的，以增长为驱动力的金融创新得到确认，其因果关系从经济增长到金融创新。在有条件地抵销金融发展之后，双向因果关系也存在。Beck，Chen，Lin，＆Song，（2016）使用金融中介业的研发支出数据作为金融创新代理。在32个国家/地区的银行，行业和国家/地区数据中使用OLS以及GMM估算器。他们得出结论，一个国家的全球增长机会与更高水平的金融创新和GDP增长之间存在积极而重要的关系。作为研究的结果，他们发现了支持金融创新的利弊的证据。Azimova＆Mollaahmetoglu（2017）使用2005-2014年期间的20个国家/地区数据，研究了金融创新和服务对储蓄和国内储蓄建筑面板数据分析的影响。他们得出结论，金融创新和金融获取水平是影响总储蓄和国内总储蓄的重要参数。DeYounget等。（2007年）注意到有证据表明，金融创新可以促进银行增长，并以此支持金融深化。拉文（Laeven）等所有人（2015年）建立了熊彼特模型，在这种模型中，企业家通过发明更好的商品来获利，而利润最大化的金融家则开始筛选企业家。它预测，除非金融家进行创新，否则技术创新和经济增长最终将停止，并暗示阻碍金融创新的法规可能对