Bond markets and economic growth

Fink, Gerhard and Haiss, Peter and Hristoforova, Sirma (2003) Bond markets and economic growth. EI Working Papers / Europainstitut, 49. Forschungsinstitut für Europafragen, WU Vienna University of Economics and Business, Vienna.


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This paper examines the relationship between the development of the aggregate bond markets and real GDP in 13 highly developed economies. The recent interest in the ties between the real and the financial sector has usually been on the banking sector and the stock markets, rather ignoring the bond markets as a third essential source of external finance. We fill this gap by providing empirical evidence for causality patterns supporting the supply-leading approach in the USA, UK, Switzerland, Germany, Austria, the Netherlands and Spain over the 1950 to 2000 period. In the cases of Japan, Finland and Italy we find evidence of interdependence between bond market capitalization growth and real output growth. Granger causality test and co-integration approach are employed to support this conjecture. (author's abstract)

Item Type: Paper
Keywords: bond markets / financial markets / economic development / Granger causality
Classification Codes: JEL E44, O16, O40
Divisions: Forschungsinstitute > Europafragen
Depositing User: Repository Administrator
Date Deposited: 30 Apr 2003 13:56
Last Modified: 22 Oct 2019 00:41


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