A review on stock market, bank and economic growth literature / Siti Muliana Samsi

This study gives a comprehensive review of the literature on the interaction between stock market, bank and economic growth. This is an area of research that has interested economists for a long time. Empirical studies show that wellfunctioning banks encourage and accelerate economic growth, but these studies rarely examine stock market development at the same time. Nevertheles s, there is a contradictory view of the effect of the bank on economic growth, with some empirical work found no statistically significant relationship between banking sector development and economic growth. The study suggests that further development in t and nonhe financial financial sector is fundamental for better economic performance. No doubt there may some undesirable consequences which are harmful to the economy, but on averages its beneficial effects outweigh the consequences.