Ferreira, Cândida2021-04-202021-04-202021-04Ferreira, Cândida (2021). "Financial development and macroeconomic performance : a panel data approach". Instituto Superior de Economia e Gestão – REM Working paper nº 0173 – 20212184-108Xhttp://hdl.handle.net/10400.5/21221Using panel fixed and random effects estimations as well as panel dynamic GMM estimations this paper analyses the contribution of the financial development, measured through the nine IMF financial development indices, to five macro performance indicators. The paper considers a panel with 46 developed countries, and a panel including only the sub-sample of the 28 EU countries, both over the interval 1990-2017. There are no remarkable differences between the results obtained for the two panels, and despite the lack of full convergence regarding the sign and strength of all estimation results, it is still possible to conclude that the IMF financial development indices have a dynamic and robust influence on all the five macro performance indicators. Overall, these indices contribute positively to the real GDP and negatively to the deflator, to the unemployment rate, to the current account, as well as to the net international investment position. There is also evidence that the results regarding the indices related to the different aspects of the financial institutions (access, depth, and efficiency) are statistically more robust than the results regarding the indices addressing the same aspects of the financial institutions.engFinancial developmentIMF financial development indicesmacroeconomic performancepanel estimationsfixed and random effects estimationspanel dynamic GMM estimationsworking paper