Nexus between financial and real sector

  • Fink, Gerhard (PI - Project head)
  • Hristoforova, Sirma (Researcher)
  • Mantler, Hans-Christian (Researcher)

Project Details


The focus of this macroeconomic research project is the empirical analysis of the financial sector's contribution to real economic growth. This analysis is also performed on the disagregate level (share, bond and credit markets). The empirical study covers all EU countries, Norway, Switzerland, the USA and Japan, as well as the EU accession candidates (including Cyprus, Malta, and Turkey).

Until recently, interdependencies between the financial structure and a country's GDP have largely been ignored. Due to the observation of a considerable trend from dominating credit sectors towards an increasing importance of capital market-based financing instruments, the question of interedependencies between the various financial sectors with respect to their influence on real GDP has been gaining importance.

Apart from the extent and the direction of financial sectors' contribution to real growth, the stability of observed causal relations over time is examined. The project's results may shed light on important steering parameters of monetary policy, financial market regulation and GDP forecasting, in particular during a period of structural breaks.

The methodolgies applied involve Granger causality tests and an econometric production function approach. The latter is particularly designed to deal with accession countries for which sufficiently long time series are not available.

Financing body

Oesterreichische Nationalbank (Jubiläumsfonds)
Effective start/end date15/11/0114/11/03

Austrian Classification of Fields of Science and Technology (OEFOS)

  • 506004 European integration