摘要：An endogenous growth model on finance and growth is formulated, and empirical analyses
are conducted. The model exhibits structural shifts and breaks caused by institutional changes,
suggesting that a linear approach is inadequate. To address this point empirically, we fit data
for 90 countries from 1960–2000 to a standard growth equation with a proxy for financial
activity. Firstly, it is shown that a growth enhancing outcome of financial activity is
contingent on a sound institutional framework. Then, we order the sample by control variables
which follow from the model as potential causes of breaks in the adjustment process.
Threshold regressions reveal non-linearities that are consistent with the model. Most
importantly, we find signs for excessive financial development.
