تورم، توسعه مالی و رشد اقتصادی

A simple endogenous growth model is developed to illustrate the important role played by inflation in determining the effects of financial development on economic growth. In the model, money is needed for loan transactions and the operations of financial markets are subject to informational imperfections. Results demonstrate that if a government's spending share is relatively large, then multiple equilibria arise under which financial development, measured by a decrease in the monitoring cost, is shown to raise inflation and reduce economic growth for countries with relatively high initial inflation rates. Only when initial inflation rates are relatively low will financial development reduce inflation and promote growth. Effects of an expansion policy in which the government raises its spending share on equilibrium inflation and economic growth are also examined.

Stimulated by the development of the endogenous growth model, the last decade has witnessed a resurgence of interest in the relationship between financial development and economic growth. For example, recent studies (as in Bose & Cothren, 1996, Bose & Cothren, 1997 and Saint-Paul, 1992) have developed theoretical models of endogenous growth to demonstrate how the development of financial markets eases informational frictions in financial markets, enhances the economy's efficiency of resource allocations, and thereby fosters economic growth.1 On the empirical side, a significantly positive correlation between indicators of financial development and economic growth has been reported by King & Levine, 1993a and King & Levine, 1993b and Levine and Zervos (1998).

This paper develops a simple framework which allows inflation to play an important role in determining the relationship between financial development and economic growth. In contrast to existing literature that views inflation as the only force to affect the operations of financial markets, this paper follows Di Giorgio (1999) and Pagano (1993) by considering a reduction in the verification cost as financial development. Given this, both inflation and financial development influence the operations of financial markets and thus economic growth