Banking Sector Instability and Economic Growth: Evidence from Turkey

Bayar, Yılmaz; Gündüz, Murat; Sezgin, Funda H.

doi:http://dx.doi.org/10.17093/alphanumeric.641629

Banking Sector Instability and Economic Growth: Evidence from Turkey

Yılmaz Bayar, Ph.D.

Murat Gündüz, Ph.D.

Funda H. Sezgin, Ph.D.

Abstract

The banking sector, an important component of the financial system, can affect the economic growth through raising and mobilizing the savings, channeling the funds to the productive uses and enhancing the efficiency. However, the deteriorations in the banking sector stability may negatively affect the economic growth through preventing the efficiently functioning of the aforementioned interaction channels. This study investigates the effect off banking sector instability and banking sector development on the economic growth in Turkey during August 2006-December 2018 through time series analysis. We revealed that the banking sector instability negatively affects the economic growth, but banking sector development positively affects the economic growth.

Keywords: Banking Sector Development, Banking Sector Instability, Economic Growth, Financial Development, Time Series Analysis

Jel Classification: F43, G24

Suggested citation

Bayar, Y., Gündüz, M. & Sezgin, F. H. (2019). Banking Sector Instability and Economic Growth: Evidence from Turkey. Alphanumeric Journal, 7(2), 263-274. http://dx.doi.org/10.17093/alphanumeric.641629

bibtex

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