Abstract

The aim of this study is to investigate the relationship between economic growth and participation banking, deposit banking, development and investment banking sectors operating in Turkey. In the study, a total of 42 quarters of data between 2010/Q1 and 2020/Q2 were examined using the ARDL bound testing. The separate research model has been established for the participation, deposit and investment banking sectors. In the models established for relevant sectors loans, total assets and net operating profit as independent variables; gross domestic product is considered as the dependent variable representing economic growth. Firstly, quarterly series are seasonally adjusted and logarithmic transformation. Then, the stationarity of the series was tested. In the findings obtained from the ARDL analysis, participation, deposit, development and investment banking sector and economic growth are co-integrated in the long run. In other words, a statistically positive relationship has been found between the variables of banking activity types and economic growth. Another finding obtained from the study is that among banking activity types, participation banks contribute more to economic growth in the long run compared to other banking activities.

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