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Working paper

Financial Systems and Economic Growth: An Evaluation Framework for Policy (WP 04/17)

Issue date: 
Wednesday, 1 September 2004
View point: 
Publication category: 
JEL classification: 
G10 - General Financial Markets: General (includes Measurement and Data)
G20 - Financial Institutions and Services: General
G38 - Corporate Finance and Governance: Government Policy and Regulation
H25 - Business Taxes and Subsidies including sales and value-added (VAT)
Fiscal year: 

Formats and related files

The purpose of this paper is to develop an analytical framework for discussing the link between financial systems and economic growth. Financial systems help overcome an information asymmetry between borrowers and lenders. If they do not function well, economic growth will be negatively affected.


We would like to thank Rienk Asscher, Felicity Barker, Matt Benge, John Bryant, David Carrigan, John Creedy, Nick Davis, Kerryn Fowlie, Ruth Gabbitas, Arthur Grimes, Kirstie Hewlett, Geoff Lewis, Brian McCulloch, Andrew McLoughlin, Duncan Mills, Brendon Riches, Clive Thorp, Bruce White and Ian Woolford for useful comments at various draft stages. Thank you to Bronwyn Croxson for her editorial work. Thanks are also due to Anand Kochunny and Raewyn Peters for research assistance.


The views, opinions, findings, and conclusions or recommendations expressed in this paper are strictly those of the authors. They do not necessarily reflect the views of the New Zealand Treasury. The New Zealand Treasury takes no responsibility for any errors or omissions in, or for the correctness of, the information contained in this paper. The paper is presented not as policy, but to inform and stimulate wider debate.

Last updated: 
Tuesday, 23 October 2007