Regional finance and growth : empirical evidence on the relationship between financial and economic development on the local level

Empirical research on regional financial structures and economic growth development is rare, due to two reasons. First, in many countries disaggregated data on regional banking structures are not available for research. Second, empirical economic research on the finance and growth sector faces an inherent problem of endogeneity. This work solves both problems by presenting a unique
and just recently created database on regional German banking structures and by using the historic event of the German reunification and the unique German savings bank system as instruments.