Topical Analysis

In sharp contrast, Robinson pioneered in his model of expanding financial system that the expansion in the financial sector will depend on the performance of the economy. In support of this, Gurley and Shaw argued that in durations of financial growth, international locations additionally experience fast growth in monetary assets. Further, they averred that the development of the financial sector is contingent on situations of supply and demand of economic belongings that are very sensitive to financial development. Likewise some authors also proffer that the monetary sector could also be an essential indicator of financial progress and not essentially the cause of growth. For occasion, Rajan and Zingales divulged that financial markets can anticipate future economic growth and respond in like method. Thus, the theoretical channels on finance-growth literature have turn out to be complicated and puzzling.

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