Bank credit and economic growth: A dynamic threshold panel model for ASEAN countries

While it is widely recognized that the development of a sound financial system may contribute to foster economic growth, relation between growth and activities complex. In this perspective, our contribution investigates existence threshold effects in relationship bank credit. Our sample ASEAN countries examined over period spanning from 1993 2019. We use approach Kremer et al. (2013) estimate dynamic panel where group explanatory variables can be endogenous. results confirm vanishing effect finance on growth. found 96.5% (significant at 5% level) for credit-to-GDP ratio, variable. short run, observations inferior or equal threshold, positive credit expansion around 0.08 1% level). Whereas, superior 0.01, but not significant. The role exporting firms essential as they are more export-oriented than other regions world economy. indicate beneficiary (firms versus households), structural features (export-led growth), regional heterogeneity have considered empirical investigations This evidence help formulate policy recommendations.