Evaluating the nexus between financial deepening and economic growth: evidence from Ukraine

• Authors: Iryna Kondrat , Olha Kots
• Languages of publication: EN

Abstracts

EN

In this paper systemic problems of Ukrainian banking sector are reviewed and the solutions are offered. The main objective of the study is to examine the relationship between a financial deepening and economic growth in Ukraine by estimating several multiple regression models over the 1993 to 2015 period. A real GDP growth per capita was used as an indicator for the economic growth. The domestic credit to private sector (% of GDP) was used as an index of financial depth. The study concludes that financial deepening causes a slight impact on the economic growth of Ukraine. A low level of impact is an indicator of a limitedness of lending to the real economy. This means that banking sector has not become the real driving force of the economic growth in Ukraine yet. The study suggests a statement that policy makers should design the policies which will encourage lending especially high tech production, small and mid-size business, micro financing to the real economy to promote economic growth and increase employment.

Keywords

EN

financial deepening; economic growth; banking sector; multiple regression analysis

• Publisher: Wydawnictwo Uniwersytetu Ekonomicznego we Wrocławiu
• Journal: Nauki o Finansach
• Year: 2018
• Issue: vol. 23 no. 1
• Pages: 49-64

Contributors

author

Iryna Kondrat

author

Olha Kots