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THE CAUSAL RELATIONSHIP BETWEEN BANK CREDIT FOR REAL ESTATE AND ECONOMIC GROWTH IN ALBANIA.

Authors :
GABESHI, KLEJDA
Source :
Annals of 'Constantin Brancusi' University of Targu-Jiu. Economy Series / Analele Universităţii 'Constantin Brâncuşi' din Târgu-Jiu Seria Economie; 2023, Issue 1, p188-193, 6p
Publication Year :
2023

Abstract

Construction has become one of the main sectors supporting economic growth in Albania in recent years. Some of the factors that have boosted the growth are: the increase of residential projects, the continuation of postearthquake reconstruction works and public investments, mainly in road construction. A VEC model will be presented in this paper that uses bank credit for real estate as a cointegrated variable with GDP growth, as the construction sector in Albania occupies a very important role in the economy. The objective of this model is to identify the shortterm and long-term causal relationship between this credit activity and economic growth in Albania. The analysis by subject and purpose of credit use shows that real estate investment credit for individuals occupies the largest share of the total credit portfolio, followed by real estate credit granted to businesses. From the results of the econometric model it was concluded that credit to the real estate sector has a positive effect on long-term economic growth. The construction sector is one of the sectors that contribute the most to GDP and, at the same time, to the growth of the banks' loan portfolio. Lending to this sector, according to the results of this model, has a positive influence on the economy. [ABSTRACT FROM AUTHOR]

Details

Language :
English
ISSN :
18447007
Issue :
1
Database :
Supplemental Index
Journal :
Annals of 'Constantin Brancusi' University of Targu-Jiu. Economy Series / Analele Universităţii 'Constantin Brâncuşi' din Târgu-Jiu Seria Economie
Publication Type :
Academic Journal
Accession number :
162886611