Financial Development/FD

Control Variables ln(X1,...,Xn)

Economic Volatility/EV, = Yt = γ1FDt + γ2FDt2

Non-linear Relationship?

No Non-linearity

Inverted U-Curve/H1/H2 Supported

Threshold Point in FD* where EV peaks

Developed vs. ln(Developing) Countries

PCSE Estimation/Corrects for autocorrelation, heteroscedasticity

GMM Robustness Check/addresses endogeneity

Final Results

Figure... Research Thinking Framework