Financial intermediation and economic growth in the Czech Republic in the years 1995 - 2007
|Author:||Mgr. Drahomíra Baboučková|
|Year:||2008 - summer|
|Leaders:|| doc. Ing. Tomáš Cahlík CSc.
|Work type:|| Finance, Financial Markets and Banking
|Awards and prizes:|
|Abstract:||This paper sets out to find out how financial intermediation influenced economic growth in the Czech Republic in the years 1995 – 2007. To analyse this question the VEC (Vector Error Correction) model for GDP, employment, capital accumulation and financial intermediation depth was set up. The depth of financial intermediation was measured by the ratio of the private sector loans to GDP. Based on the results of this analysis it is possible to conclude that in the long term the financial intermediation has a positive impact on economic growth. However, in the short term the results do not support the hypothesis of financial intermediation having a positive impact on economic growth. Regarding the future economic development of the Czech Republic the model predicts further growth of economy accompanied by moderate growth of the financial intermediation depth for years 2008 – 2009.|