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Finance and Inclusive Growth
Report

Finance and Inclusive Growth

Boris Cournède, Oliver Denk and Peter Hoeller
OECD, 2015
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Editorial Rating

7

Qualities

  • Analytical
  • Well Structured
  • Background

Recommendation

The massive upsurge in private sector credit and stock market capitalization in OECD countries in recent decades has been both a blessing and a bane. While the increased availability of debt and equity finance can help promote economic output, too much of a good thing can quickly become bad. OECD economists Boris Cournède, Oliver Denk and Peter Hoeller investigate this tendency and offer essential insights into the complex interplay of finance and the real economy, which getAbstract suggests to policy makers, financial professionals and regulators.

Take-Aways

  • In OECD countries, equity markets’ capitalization and credit extended to the private sector have each tripled relative to GDP since the 1960s and 1970s, with both positive and negative impacts.
  • Constructive influences include the productive allocation of capital, enhanced global trade and financial-sector productivity gains that spill into other parts of the economy.
  • But extensive risk, booms and busts, and income inequality are some of the negative effects of financial expansion.

About the Authors

Boris Cournède, Oliver Denk and Peter Hoeller are OECD economists.

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