2010-07-022010-07-022010-06Bittencourt, M 2010, 'Financial development and economic growth in Latin America: Schumpeter is right!', University of Pretoria, Department of Economics, Working paper series, no. 2010-14. [http://web.up.ac.za/default.asp?ipkCategoryID=736&sub=1&parentid=677&subid=729&ipklookid=3]http://hdl.handle.net/2263/14381In this paper we investigate the role of financial development, or more wide-spread access to finance, in generating economic growth in four Latin American countries between 1980 and 2007. The results, based on the relatively novel panel time-series analysis, confirm the Schumpeterian prediction which suggests that finance authorises the entrepreneur to invest in productive activities, and therefore to promote economic growth. Furthermore, given the characteristics of the sample of countries chosen, we also highlight the importance of macro-economic stability, and all the institutional framework that it encompasses, as a necessary condition for financial development, and consequently for growth and prosperity in the region.enUniversity of Pretoria, Department of EconomicsEconomic development -- Latin America -- Mathematical modelsLatin America -- Economic conditionsFinance -- Latin America -- Mathematical modelsTime-series analysisEntrepreneurship -- Latin AmericaSchumpeter, Joseph Alois, 1883-1950 -- Criticism and interpretationWorking Paper