Fi̇nanci̇al depth and the effect on economic growth

Financial systems begins their missions as money transaction mechanism of the economies then they became as a key influencer of economic growth in recent years. Financial depth as a part of financial development maens that an incraese and also an improvement of the functions of the financial system. In this study, we investigated the effect of financial depth on economic growth. The World Bank's financial depth indicators are used to analyse the effect of financial depth on Gross Domestic Product (GDP) per capita growth by using panel data analysis method. Broad money to GDP, deposit money bank assets to GDP, stock market capitalization to GDP and outstanding debt securities to GDP indicators are used to measure financial depth. In this study, ten Newly Industrialized Country's data set are used covering the period 1995-2016. The result of this study is that financial depth has a positive and significant effect of on economic growth.