Bank stocks inform higher growth—A System GMM analysis of ten emerging markets in Asia

The paper aims to recover the critical role of banks in defining relationship between Financial Development and growth. We hypothesize that Banks can positively motivate templatized GDP A System GMM estimation growth a sample high emerging markets from Asia investigates if bank stocks contain information beyond monetary banking aggregates. In with 5 % growth, create 0.22 for every 1 SD excess return weighted portfolio stocks. chosen are homogenous based on WGI Indicators World Bank. This coefficient is much higher than recovered presented by Cole et al. (2008). Government ownership close monitoring found be positive overall economy while market index not so informative about economic relook at system study (2008) shows better investors without compromising quality. research establishes advantages selecting portfolios reward governance. set homogenized engender causative effects allowing focus investment opportunity.