Transition Studies Review

, Volume 19, Issue 3, pp 347–356 | Cite as

The Impact of European Monetary Union on Finance-Growth Nexus

  • Saeed Armin
  • Saifuzzaman Ibrahim
  • W. N. W. Azman-Saini
Next Europe Research: European Institutions, Enlargement, Wider Integration and the World
First Online:
  • 119 Downloads

Abstract

This study examines the relationship between financial development and economic growth in 15 developed European countries before and after the formation of the euro. The results of the panel data analysis show that financial development is significant in promoting economic growth for both periods. The impact of the banking sector development on growth, however, is greater in the post-euro period, whereas the impact of stock market development on growth is reducing in the period investigated. The study concludes that the formation of European Monetary Union does not weaken the relationship between financial development and economic growth in developed European countries.

Keywords

Financial development Economic growth European monetary union Panel data analysis 

JEL Classification

O43 F36 G15 O52 
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Copyright information

© Springer-Verlag Wien 2012

Authors and Affiliations

  • Saeed Armin
    • 1
  • Saifuzzaman Ibrahim
    • 1
  • W. N. W. Azman-Saini
    • 1
  1. 1.Department of Economics, Faculty of Economics and ManagementUniversiti Putra MalaysiaSerdangMalaysia

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