Abstract

LOPEZ JUSTINIANO, Roger Mario. Financial development and Economic growth for Bolivia. Oikos Polis [online]. 2016, vol.1, n.1, pp. 50-88. ISSN 2415-2250.

Abstract: The process of economic growth is one of the most studied topics by social scientists as countries with high rates of economic growth would be associated with a greater degree of welfare. The financial system has been subject of debate among economists who believe that it can contribute to economic growth with its functions: channeling savings, reduced transaction costs, efficient allocation of resources, etc. However, there is not a unanimous position in this area of research. On the other hand, Bolivia in recent years has made improvements in their levels of GDP per capita that it is important to determine why this phenomenon is due to. While the financial system has been consolidated in the country, it does not seem to be a major source of growth in GDP per capita in Bolivia. One possible explanation for these results is that the financial crises of the 80s have nullified the positive impact that is both theoretically and empirically between financial development and economic growth in the long term, on the other hand, more currently, the legislation could be generating 'liars prices' to the interest rates offered to the productive sector, preventing the banking system properly allocate resources.

Keywords : Financial development; economic growth.