STRUCTURAL BREAKS IN FINANCIAL SHARE, SAVINGS AND GROWTH IN OECD - 1960-92

Indivisibilities in extending financial markets imply level shifts in the financial cost share. This could induce growth and savings slumps. We search for structural breaks in the financial sector share of seve n OECD countries and relate these to changes in GDP growth and the sav ings share. The event patterns of these macro series are classified an d weighted by typicities. Financial structural breaks are associated w ith decreased savings but ambiguous with respect to growth. We conject ure that most of the period is a successive transition to increasing f inancial shares accompanied by lower savings and more sluggish growth.