Contribution of Financial Market Segments at Different Stages of Development: Transition, Cohesion and Mature Economies Compared

Posted: 6 Aug 2008

See all articles by Gerhard Fink

Gerhard Fink

Dept of International Business and Trade

Peter R. Haiss

WU Vienna University of Economics and Business; UniCredit Bank Austria; IES Vienna - Institute for the International Education of Students

Goran Vuksic

Institute of Public Finance

Date Written: August 4, 2008

Abstract

What is the impact of financial sector segments at different stages of development? We apply a production function approach to investigate the impact of the credit, bond and stock segments in nine EU-accession countries over early years of transition (1996-2000) and compare these to mature market economies and to countries at intermediate stage. We find that the transfer mechanisms differ over the development cycle (from bond markets to educational attainment to labor participation) and that financial market segments with links to the public sector (but not stock markets) contributed to stability and growth in transition economies.

Keywords: Finance-growth, EU-accession countries, Production function, Financial sectors

JEL Classification: C23, G10, G21, H74, O11, O16, O52

Suggested Citation

Fink, Gerhard and Haiss, Peter R. and Vuksic, Goran, Contribution of Financial Market Segments at Different Stages of Development: Transition, Cohesion and Mature Economies Compared (August 4, 2008). Journal of Financial Stability, 2008, Available at SSRN: https://ssrn.com/abstract=1201242

Gerhard Fink (Contact Author)

Dept of International Business and Trade ( email )

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Peter R. Haiss

WU Vienna University of Economics and Business ( email )

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Goran Vuksic

Institute of Public Finance ( email )

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Croatia
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HOME PAGE: www.ijf.hr

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